China’s Jingye is seeking compensation from the UK over the takeover of British Steel

The Chinese owner of British Steel has initiated formal proceedings to seek compensation from the UK government following the decision to nationalise the steelworks in Scunthorpe, according to The Guardian.

Jingye Steel has stated that it will seek compensation under the bilateral investment treaty between China and the UK following more than a year of negotiations regarding the amount of the payout. The decision to seek a settlement within this framework may give the Chinese owner an advantage in the negotiations, the publication notes.

A statement on the company’s WeChat page reads: the group hopes that the British government will be able to fully protect the legitimate rights and interests of Jingye and other Chinese enterprises, as well as international investors.

Jingye acquired British Steel in 2020 as part of a government-brokered deal.

Under the Sino-British agreement, the dispute may be referred to international arbitration in six months’ time. Although Jingye was prepared to relinquish the steelworks in Scunthorpe, its takeover by the British side has likely increased its chances of recovering some of its funds.

The UK took operational control of British Steel in April 2025, and in May this year, Prime Minister Keir Starmer announced plans to fully nationalise the company.

Last June, Jingye announced plans to attempt to recover up to £711 million in debts from British Steel, although industry representatives stated that the company is claiming over £1 billion.

It should be recalled that in May, China warned London against nationalising British Steel. Beijing called on the British government to “make decisions prudently” regarding these plans and to respect “the wishes of firms and market principles, avoiding the abuse of administrative coercive measures”. The Chinese Ministry of Commerce stated that it would closely monitor developments.