Key Facts
- •LetterOne Group companies sought judicial review of a divestment order under the National Security and Investment Act 2021 (NSIA).
- •The order required divestment of a 100% shareholding in Upp Corporation Limited, a fibre broadband company, on national security grounds.
- •The Secretary of State for BEIS (later the Chancellor of the Duchy of Lancaster) made the order personally.
- •The Claimants argued the order breached human rights (disproportionate and lack of compensation), public law principles (irrelevant considerations, Tameside duty, irrationality), and procedural fairness (insufficient disclosure, unfair opportunity to address concerns).
- •The Secretary of State relied on open and closed material due to national security concerns.
- •The Claimants' acquisition of Upp triggered the NSIA, due to the ultimate beneficial owners being sanctioned Russian nationals.
- •Less intrusive measures ('Remedy B') were considered but rejected in favor of divestment ('Remedy A').
- •The Claimants argued that other statutory powers could have been used instead of divestment.
- •The Claimants received less for the sale of Upp than their investment.
Legal Principles
Proportionality under Article 1 of the First Protocol to the European Convention on Human Rights (A1P1)
ECHR case law, AXA General Insurance Ltd v HM Advocate [2011] UKSC 46
Wednesbury unreasonableness
Associated Provincial Picture Houses Ltd v Wednesbury Corpn [1948] 1 KB 223
Tameside duty of inquiry
Secretary of State for Education and Science v Tameside Metropolitan Borough Council [1977] AC 1014
Procedural fairness, including the duty to consult
R (Osborn) v Parole Board [2013] UKSC 61, R v Secretary of State for the Home Department, Ex parte Doody [1994] 1 AC 531, Bank Mellat v Her Majesty’s Treasury (No 2) [2013] UKSC 39
Judicial review under the Senior Courts Act 1981
Senior Courts Act 1981, section 31(2A)
Deference to executive decisions on national security
R (Begum) v Special Immigration Appeals Commission [2021] UKSC 7
Human Rights Act 1998, sections 6, 7, and 8
Human Rights Act 1998
Outcomes
Claim dismissed.
The court found the divestment order to be a proportionate response to national security risks, even considering alternative measures. The procedural fairness and public law challenges were also rejected.
Permission for judicial review granted on Grounds 1B (compensation) and 3 (procedural fairness), but dismissed substantively.
While the court acknowledged the stringency of the order and the lack of full compensation, it held that national security interests outweighed the Claimants' financial interests. The procedural process was deemed fair.
Permission for judicial review refused on Grounds 1A (proportionality under A1P1), 2A (relevant/irrelevant considerations and Tameside duty), and 2B (Wednesbury unreasonableness).
The court found that the Secretary of State acted within his powers and the challenges were not arguable on legal grounds.