Overview
On April 1, 2025, the Minister of State for Security, Dan Jarvis, announced that the UK’s long-anticipated Foreign Influence Registration Scheme (“FIRS”) will go live on July 1, 2025. FIRS is a two tier registration scheme established under Part 4 of the National Security Act 2023 (“NSA”), which seeks to respond to the evolving threat of hostile activity from states targeting the UK by ensuring transparency of foreign influence in UK politics (“Political Influence Tier”) and providing greater assurance around the activities of certain, specified foreign powers or entities that may pose a risk to the UK’s safety and national interest (“Enhanced Tier”). The UK government also has announced its intention to make the first specifications under the Enhanced Tier of Iran and Russia. Businesses now have just under three months to assess the impact of the scheme on their activities and prepare for compliance with applicable registration requirements.
Political Influence Tier
Registration Requirement
Under the Political Influence Tier of FIRS, unless an exemption is available individuals and entities in the UK (each a “Person”) will have to register an agreement or arrangement with any foreign power pursuant to which the foreign power directs the Person to carry out political influence activities, or to arrange for such activities to be carried out, in the UK. Registration of ongoing agreements or arrangements entered into before FIRS comes into effect must be completed by October 1, 2025. Registration of new agreements or arrangements made once FIRS comes into force must be completed within 28 days starting on the date the particular arrangement is made. However, agreements or arrangements made prior to, and completely finished before, July 1, 2025 do not need to be registered.
A “foreign power” means: (i) the sovereign or other head of a foreign state acting in their public capacity; (ii) a foreign government, or part of a foreign government; (iii) an agency or authority of a foreign government, or of part of a foreign government; (iv) an authority responsible for administering the affairs of an area within a foreign country or territory, or persons exercising the functions of such an authority; or (v) a political party that is a governing political party of a foreign government.
For the purpose of this obligation, a “political influence activity” includes the following activities when all or part of the activity’s purpose is to influence a UK election or referendum, a ministerial decision, the proceedings of a UK political party, or a member of parliament (or the devolved administrations):
- any communication to ministers, members or parliament (or the devolved administrations) and their staff, candidates in UK elections, as well as certain civil servants, local government officials, military personnel, members of the police, UK political party personnel, and persons exercising specified public functions whether within or outside the UK;
- publishing, disseminating, or producing for publication/dissemination information, documents, or articles (a so-called “public communication”), except when it is reasonably clear from the communication that it is made by or at the direction of the foreign power; or
- distributing money, goods or services to UK nationals and individuals living in the UK, as well as entities or unincorporated associations incorporated or formed under UK law (“UK Persons”).
Exemptions
There are a number of exemptions to the registration obligation under the Political Influence Tier, which include:
- anyone acting as part of an arrangement to which the UK or a Crown employee (acting in that capacity) is a party;
- individuals acting for a foreign power in their official capacity;
- certain domestic and international news publishers; and
- lawyers in their provision of legal services to foreign powers.
Following the UK government’s acknowledgment that FIRS could impose undue burdens on some sovereign wealth funds, the draft National Security Act 2023 (Foreign Activities and Foreign Influence Registration Scheme: Exemptions for Certain Foreign Power Investment Funds, Education, Government Administration and Public Bodies) Regulations 2025 (“Draft Exemption Regulations”) have been laid before parliament, which include a proposed exemption for “foreign power investment funds” when directed by a foreign power to engage in political influence activities in the UK relating to investment activities in the UK or a third country. The exemption would apply to funds: (i) wholly-owned or controlled directly or indirectly by the foreign power; (ii) that principally make or manage investments outside the country/territory of the foreign power (“Overseas Investments”); (iii) that source the funds for their Overseas Investments wholly or partially from the foreign power; and (iv) engage in Overseas Investments for the sole purpose(s) of financially benefitting the foreign power and/or making provision for the payment of pensions to persons by the foreign power.
Enhanced Tier
Registration Requirement
Under the Enhanced Tier of FIRS, unless an exemption is available a Person will have to register an agreement or arrangement with a foreign power specified by regulations under the NSA or another person specified by virtue of being controlled by such a power and pursuant to which the specified person directs the Person to carry out, or arrange to be carried out, any activities (unless a sub-set of activities to which the registration requirement is limited are set out in regulations addressing one or more specified persons) in the UK (a “Foreign Activity Arrangement”). Registration of ongoing agreements or arrangements entered into before FIRS comes into effect must be completed by October 1, 2025. Registration of new agreements or arrangements made once FIRS comes into force must be completed within 10 days starting on the date the particular arrangement is made. However, agreements or arrangements made prior to, and completely finished before, July 1, 2025 do not need to be registered. Where an arrangement would fall within both the Enhanced Tier and the Political Influence Tier, registration is only required under the Enhanced Tier.
Specified Persons
The Home Secretary is authorized to specify any foreign power or entity that she reasonably believes to be controlled by a foreign power, if she considers it reasonably necessary to do so to protect the safety or interests of the UK. A person is “controlled by a foreign power” if one or more of the following conditions are met:
- Condition One – the foreign power has the right to direct or control, or actually directs or controls, the person’s activities (in whole or in part);
- Condition Two – the foreign power holds, directly or indirectly, more than 25% of the shares in the person;
- Condition Three – the foreign power holds, directly or indirectly, more than 25% of the voting rights in the person;
- Condition Four – the foreign power holds the right, directly or indirectly, to appoint or remove an officer of the person; and/or
- Condition Five – the trustees of a trust, or the members of a partnership, unincorporated association or other entity that is not a legal person under the law by which it is governed meet one or more of Conditions One - Four (in their capacity as such) in relation to the person, and the foreign power has the right wholly or partially to direct or control, or actually directs or controls, the activities of that trust or entity.
The UK government has laid draft regulations before parliament proposing the first specifications under the Enhanced Tier of FIRS of Iran and Russia.
With respect to Iran, the UK government proposes specifying as a foreign power (i) the Supreme Leader of Iran in their public capacity and (ii) the Government of Iran, including any part of the government and all of its agencies and authorities. Additionally, the Islamic Consultative Assembly of Iran and judiciary of Iran would be specified as persons controlled by a foreign power.
As regards Russia, the UK government proposes specifying as a foreign power (i) the President of Russia in their public capacity; (ii) the Government of Russia, including any part of the government and all of its agencies and authorities; and (iii) the government of a federal subject of Russia. Additionally, the: (i) the Federal Assembly of Russia (including the Federation Council or the State Duma); (ii) judiciary of Russia; (iii) United Russia Party; (iv) Communist Party of Russia; (v) Liberal Democratic Party of Russia; and (vi) A Just Russia Party would be specified as persons controlled by a foreign power.
There has been speculation over the past year that China could also be specified under the Enhanced Tier. While the Conservative Party has, and continues to support, the specification of China, the current UK government has refused to be drawn on any future specifications of countries under FIRS. However, the current UK government’s approach toward China, which seeks to embrace cooperation where possible, compete where needed, and challenge where necessary, including with respect to national security, is perhaps more complex and nuanced than the approach of the previous Conservative government.
Exemptions
There are a number of exemptions to the registration obligation under the Enhanced Tier, which include:
- anyone acting as part of an arrangement to which the UK or a Crown employee (acting in that capacity) is a party;
- the provision of goods or services that are reasonably necessary to support the efficient functioning of a diplomatic mission, consular post, or the permanent mission to a UK-based international organization of a country which is a member of the organization; and
- lawyers in their provision of legal services to foreign powers.
The Draft Exemption Regulations also have been laid before parliament, which include additional proposed exemptions in relation to the Enhanced Tier covering, for example, (i) arrangements to provide financial support to students of further or higher education in the UK where the specified foreign power gives directions to the student or education provider that facilitate the arrangement and (ii) arrangements where specified foreign powers give directions to people seeking administrative or technical services, including consular services.
Interaction of FIRS with Other Registration and Approval Regimes
The registration requirements under FIRS are separate and distinct to the: (i) registration requirements under the Transparency of Lobbying, Non-Party Campaigning and Trade Union Administration Act 2014, which require individuals or organizations to register with the Registrar of Consultant Lobbyists if they wish to undertake paid consultant lobbying on behalf of any third party; (ii) notification and approval requirements under the National Security and Investment Act 2021 for certain acquisitions in the UK involving particularly sensitive sectors of the economy; and (iii) approval requirements under the Academic Technology Approval Scheme for students from certain countries undertaking postgraduate research courses in areas where the knowledge gained could be used to develop advanced conventional military technology or weapons of mass destruction or their means of delivery. If registration, notification, or approval is required under multiple schemes, this will need to be completed separately under each applicable scheme.
Penalties
The NSA establishes a number of criminal offences relating to FIRS. For example, failure to comply with the registration requirement under FIRS is a criminal offence, attracting a maximum penalty of an unlimited fine for companies. Individuals can additionally, or alternatively, face imprisonment of up to two years (Political Influence Tier) and five years (Enhanced Tier).
Registration Information Requirements and Publication
A draft of the National Security Act 2023 (Foreign Activities and Foreign Influence Registration Scheme: Information and Disclosure) Regulations 2025 has been laid before parliament, which if made following scrutiny by both houses of parliament will establish the information that required to be provided in connection with registration requirements under the Political Influence Tier and Enhanced Tier. When there is a material change to a registered arrangement, the person who registered the arrangement or activity must update the information provided at registration within 14 days starting on the day on which the change takes effect.
The draft National Security Act 2023 (Foreign Activities and Foreign Influence Registration Scheme: Publication) Regulations 2025 also have been laid before parliament and, if made, will establish the registration information that will be made public for each type of registration requirement under FIRS, subject to the following exceptions:
- there is a risk that publication would be prejudicial to the safety or interests of the UK;
- there is a risk that publication would be prejudicial to the prevention/detection of crime, a criminal investigation, or criminal proceedings;
- there is significant risk that publication would put an individual’s safety at risk of serious harm; or
- the information is commercially sensitive (e., it is confidential and publication is highly likely to seriously prejudice the commercial interests of any person, other than as a result of reputational harm solely by virtue of being associated with a FIRS registration).
It is proposed that publication takes place as soon as practicable after registration and for a period of ten years from a date on which the arrangement or activities come to an end. As regards publication in relation to registrations under the Enhanced Tier, this will only be required where the activities in questions constitute political influence activities.
Key Takeaways
Any person impacted by the registration requirements under the Political Influence Tier or Enhanced Tier of FIRS should begin preparations now to register relevant agreements or arrangements that will continue on or beyond July 1, 2025. Additionally, given the risk of criminal liability for involvement in FIRS registrable activities undertaken while unregistered, entities involved in FIRS registerable agreements or arrangements should consider adopting policies and procedures to ensure that registerable activities are identified and registration requirements complied with in a timely manner. Training also should be provided to personnel on these topics. For more guidance on how FIRS may impact your business and assistance in preparing for FIRS implementation, we encourage you to contact the author of this post, Alexandra Melia in Steptoe’s London office.
