On July 16, the UK government announced the passage of legislation to "nationalize" British Steel, a subsidiary of China’s Jingye Group. The move stripped Jingye of control, management authority, and revenue rights over the company. On July 19, Jingye urged the UK to immediately stop "trampling on international investment rules" and to swiftly, fully, and effectively compensate the company for all investment losses.
Labour Government Nationalizes Jingye's British Steel.
Shattered Promises
According to Jingye Group’s official WeChat account, Jingye Steel Ltd. said on July 19 that it legally acquired British Steel in 2020 when the company was on the verge of bankruptcy, and turned it profitable within a year. Over the past five years, Jingye said it has continuously poured in massive capital, created tens of thousands of local jobs, and made a major contribution to British Steel and the UK steel industry.
Since Jingye acquired British Steel, the UK government has shifted from "promising co-investment" to "refusing to honor commitments," and from "forced takeover" to "full nationalization." Jingye’s statement called this a case of shattered promises, trampled rules, and outright betrayal.
By ignoring Jingye’s targeted investment and major contribution while offering compensation that is "almost zero," the UK has damaged the confidence of global investors.
The statement demanded that the UK immediately stop using domestic law to trample on international investment rules. It also called on London to provide timely, full, and effective compensation for all of Jingye’s investment losses. Jingye said it has already initiated consultation procedures under the relevant bilateral investment treaty and reserves all legal rights, including international arbitration.
The statement also said that, in defense of British taxpayers’ interests, Jingye will legally pursue the liability of relevant government officials and British Steel management. That claim targets what Jingye described as a rushed takeover carried out without preparation or a business plan, one that inflicted major losses on both taxpayers and the company’s operations.
Starmer Meets British Steel Workers Last April.
The Cost of Survival
According to the BBC, the UK government said bringing this loss-making company into state ownership would protect jobs and safeguard a "vital national capability." In March this year, a report by the National Audit Office said the Scunthorpe steelworks was costing the UK government about £1.3 million a day.
By late January 2026, the government had already spent £377 million to keep British Steel operating. That figure was expected to exceed £600 million by late June, and spending could top £1.5 billion by 2028.
Jiupai Finance reported that Jingye completed the acquisition of British Steel in March 2020 for roughly £50 million to £70 million, when the company was close to bankruptcy. After the deal, Jingye injected substantial funds to keep the business running.
According to Jingye’s public disclosures, the group has continued to invest over the past five years in equipment upgrades, production and operations, employee pay, and green transition projects.
Facing persistent losses and environmental pressure, Jingye proposed a transition plan. The plan called for shutting the aging blast furnaces at Scunthorpe, building electric arc furnaces, and securing major subsidy support from the UK government. But that would have closed the two blast furnaces at Scunthorpe, the core assets Jingye took over.
The UK refused, because these are the country’s last two blast furnaces capable of producing primary steel directly from iron ore. Once closed, the UK would lose its full blast furnace to basic oxygen furnace steelmaking system and become the only G7 nation without primary steel production capacity.
For a country that once relied on steel to complete its Industrial Revolution and has long treated steel as a strategic industry, that is politically close to unthinkable.
In April 2025, the UK’s Steel Industry (Special Measures) Act completed the legislative process and received Royal Assent in a single day. Under that law, the UK government gained direct powers to intervene in British Steel’s production and operations. In practical terms, it took over the company’s business decisions.
In May 2026, the UK government formally introduced the Steel Industry (Nationalization) Act to bring British Steel into state ownership by legislation. On July 16, the government announced that the relevant legislation had passed, nationalizing British Steel under Jingye Group.
Beijing Pushes Back
China’s Ministry of Commerce previously said Beijing is firmly opposed to the UK government’s decision and strongly dissatisfied with it. The ministry urged the UK to abide by relevant international rules, fulfill its obligations under the China-UK Bilateral Investment Treaty, treat Chinese enterprises in the UK fairly and justly, and fully protect their legitimate rights and interests. A Foreign Ministry spokesperson also stressed on Saturday, the 18th, that investors’ lawful rights and interests must be fully protected in accordance with the law. The spokesperson urged the UK to genuinely respect market principles and the spirit of contracts, and to find a mutually acceptable solution, including on compensation.
Analysts said the UK government has not acknowledged Jingye Group’s right to compensation. Instead, London argues that both the existence of compensation and the amount of compensation must be determined only after an independent assessment. The dispute has stirred wider concern about the security of cross-border investment and the sanctity of market contracts, while raising questions about the UK’s unilateral administrative intervention and its departure from market-oriented principles.
According to CCTV, Zhou Mi, a researcher at the Chinese Academy of International Trade and Economic Cooperation under the Ministry of Commerce, said investors place a high value on a stable local environment when making investment decisions. Many countries, including the UK, promise stable treatment when attracting foreign investment, on the basis of mutual benefit and win-win cooperation. Zhou said Chinese enterprises have fulfilled their commitments, created local jobs, and kept British Steel’s local production and normal operations running.
Zhou Mi: Nationalization Demands Fair Compensation.
Zhou said he believes Chinese steel companies bring more effective experience in the steel sector. The UK government could not sustain British Steel’s development back then, and now it is ignoring the business sector’s advice. In his view, the UK’s claimed strategic logic simply does not stand up.
Zhou said nationalization requires proper consideration. Even within the framework of a bilateral investment treaty, when the UK government proceeds with nationalization, it must pay the corresponding cost. If the UK government takes a presumptuous approach to nationalization, it must weigh the consequences. Those consequences touch the company’s reasonable future development, its normal operations, the actual interests of employees, and the UK government’s reputation and future prospects as an international investment destination.
'Robber Logic' Under Fire
Jiang Haofeng, a commentator for Xinmin Evening News, argued that the nationalization of British Steel amounts to "robber" logic. He said the UK Labour Party brought British Steel into state ownership in the name of national security and protecting workers’ rights, even though Jingye did not carry out large-scale layoffs after the acquisition.
In Jiang’s view, after taking power, Labour wanted to secure votes tied to the steel unions and then used a newly enacted law to seize a private Chinese enterprise. He questioned whether that is fundamentally illegal. Jingye had broken no laws beforehand, and the acquisition was a fair transaction approved by the UK government. So if Britain now buys it back at an extremely low price, how is that different from robbery?
Jiang also questioned how the UK, as a so-called birthplace of fair trade, could attract global investment in the future. He further asked whether there is any link between newly appointed UK Prime Minister Bei Ande taking office and the nationalization of British Steel.
Deep Throat
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