Chinese firm demands compensation after UK nationalises British Steel

Chinese steelmaker Jingye Group has demanded compensation from the British government following the nationalisation of British Steel, arguing the move caused significant financial losses and undermined investor confidence.

In a statement released on Sunday, the company criticised London‍‍`s decision to take ownership of the steel producer, saying it violated international investment rules and harmed the UK‍‍`s reputation as a destination for foreign investment.

Jingye said it had begun negotiations under bilateral investment agreements and reserved the right to pursue international arbitration if the dispute could not be resolved.

The company also said it intended to seek legal action against the British government and British Steel‍‍`s management on behalf of UK taxpayers, although it did not explain the legal basis for that claim.

"The UK ignored Jingye‍‍`s continued investment and significant contribution and was only willing to offer almost no compensation," the company said.

The British government assumed operational control of British Steel last year after Jingye warned it could shut down the blast furnaces at the company‍‍`s Scunthorpe plant, the UK‍‍`s last site capable of producing virgin steel directly from raw materials.ajke 

Last week, London formally nationalised British Steel, saying the move was necessary to safeguard thousands of jobs and secure domestic steel production for key infrastructure and defence projects.

British officials said an independent assessment would determine whether Jingye is entitled to compensation.

Jingye acquired British Steel in 2020 after the company had fallen into financial difficulty, describing the purchase as a rescue deal.

China‍‍`s Foreign Ministry also criticised the nationalisation, saying the handling of the dispute would influence Chinese investors‍‍` confidence in the UK‍‍`s business environment. 

It urged Britain to honour market principles and contractual commitments while reaching a mutually acceptable settlement on compensation.