Will a tougher national interest test for takeovers hurt Britain’s standing as an open economy?

Dr Roger Barker, head of corporate governance at the Institute of Directors, says Yes.

We are concerned that any extension of the national interest test could increase the politicisation of the UK’s takeover process. We don’t want politicians to meddle in takeover decisions based on populist considerations or due to the influence of lobbying by special interests.

There is also a risk of such discretion being used for protectionist purposes.

While we have some sympathy with Vince Cable’s desire to see that commitments made as part of a takeover are honoured, there are likely to be practical problems in what he is suggesting.

If the economic circumstances of the merged entity change over time, there may be valid reasons for a company to diverge from these commitments.

It would not be desirable to force companies to stick to them in all circumstances – there would always need to be some kind of force majeure clause in the commitment.

If legal obligations were too restrictive, it would discourage investment in the UK.

Vince Cable, the business secretary, says No.

Inward foreign investment serves the UK well, and we want to retain our reputation as an attractive destination.

But the attempted takeover of Astrazeneca by Pfizer illustrated that there may be cases where a laissez-faire approach is insufficient.

Existing takeover rules – both British and European – are insufficient to protect national interests like the scientific research bases in which the taxpayer has a large investment.

I have asked the Takeover Panel to look at ways of making meaningful and binding any public undertakings at the point of takeover by the acquiring company.

There shouldn’t be lots of wiggle room, and there should be penalties if commitments are broken.

I also believe there will be exceptional cases where companies do not negotiate a satisfactory solution, and public interest intervention is required.

I do not want protectionist legislation, but we do need a last resolute national defence.