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MPs call for "Cadbury law"

While the acquisition of Cadbury by Kraft Foods for around £12 billion may well be signed sealed and delivered the fallout from the controversial deal continues to this day. A group of MPs have now stepped forward to suggest the creation of a "Cadbury law" which would effectively offer protection to UK workers who are involved in takeovers by foreign companies.

Central to this issue is a number of promises alleged to have been made by Kraft Foods which have since been dropped, with specific emphasis on the closure of a factory which Kraft Foods had suggested would remain open after the takeover. Lord Mandelson has been very vocal in his support for protection for UK companies who attract the attention of overseas suitors but this could open a can of worms for the UK government.

It is okay to suggest that UK workers need protection but on the other hand UK companies have acquired hundreds if not thousands of overseas operations over the years. We would likely see a tit-for-tat response to any tightening of labour laws in the UK which could reduce the benefits of multinational acquisitions at a time when many companies need extra funding and extra support. It is difficult to see how the government can justify a "free market" approach yet attempt to put barriers in the way of free enterprise.

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