The Ministries have proposed amending the Security Act so that undertakings that i) control information, information systems, objects or infrastructure which are of vital importance to national security interests; or ii) engage in activities which are of vital importance to national security interests, without being directly connected to a fundamental national function, should also be fully or partly governed by the Security Act.
The scope of the Security Act is to be expanded to include undertakings of vital importance to national security interests regardless of whether the undertaking also supports a fundamental national function. A "fundamental national function" means services, production and other types of activity that are of such importance that a complete or partial loss of the function would have consequences for the State's ability to protect national security interests, e.g. infrastructure such as electricity and water supply, as well as certain financial services. The consequence of this extended scope is that it may include undertakings researching and developing emerging technologies that may be exploited by foreign states, such as artificial intelligence and surveillance technologies, even though this technology does not support any fundamental national function.
Further, the Security Act's FDI screening requirements on change of control may apply to undertakings having only a material importance to fundamental functions or national security interests. This will typically be an undertaking delivering one or more factor inputs to an undertaking of vital importance for fundamental national functions.