Understanding the Steel Industry (Special Measures) Act 2025

The UK government has introduced the Steel Industry (Special Measures) Act 2025, a crucial piece of legislation aimed at safeguarding the steel sector's assets and ensuring their continuous operation. Here's a breakdown of what it entails:

1. Definition of "Steel Undertaking": The Act defines a "steel undertaking" as any business involved, wholly or partly, in the manufacturing of steel.

2. Government Directions on Asset Usage: The Secretary of State is empowered to issue directives to steel undertakings regarding their asset usage. This applies if assets have stopped being used or are at risk of disuse, and if their continued use is deemed in the public interest. Compliance with these directions is mandatory for the undertaking and its relevant persons.

3. Enforcement for Non-compliance: If a steel undertaking or related individuals fail to comply with directives, the Secretary of State can take control of the assets directly. This includes entering premises, preventing asset disposal, and taking necessary actions to ensure safe and ongoing use of the assets.

4. Offences and Penalties: Non-compliance with directives is an offence. Penalties can include imprisonment of up to two years, fines, or both. Offences are applicable to both the undertaking and individuals involved.

5. Injunctions: The Secretary of State can seek court injunctions to prevent or address possible offences, ensuring that the specified assets' operation remains uninterrupted and safe.

6. Indemnities and Compensation: Actions taken in compliance with the Act's directives are protected from legal claims. The Secretary of State may also compensate for losses incurred due to compliance or actions taken under the Act.

7. Compensation Scheme: A framework for compensating affected steel undertakings can be established through regulations, ensuring financial support where necessary.

8. Financial Implications: Expenses incurred under the Act will be financed by parliamentary funds, highlighting the government's commitment to supporting the steel industry.

9. Legal Clarifications: The Act provides definitions for key terms like "group undertaking" and "shadow director" to ensure clarity in legal interpretations.

10. Geographic and Legislative Scope: The Act applies exclusively to England and Wales and came into force immediately upon passage.

This legislation underscores the government's proactive measures to secure the steel industry, ensuring its assets are used effectively and remain operational, thereby safeguarding jobs and economic stability in the sector.