Minister are planning to introduce new rules which would restrict the amount foreign donors could give to political parties in the UK.
Sky News reports that the plans are partially in response to rumours that Elon Musk is planning a huge $100m donation to Nigel Farage’s Reform UK.
Currently, parties can accept donations from any company registered in the UK, with foreign donors able to use these companies to make indirect contributions.
The rules mean British companies can be used for this even if they make no money.
The government is said to be looking at introducing rules which would cap the amount a company can give based on how much money it makes.
Labour say this is delivering on a manifesto pledge to “protect democracy by strengthening the rules around donations to political parties.”
Earlier this year, there were reports that Elon Musk was planning an astronomical $100m donation to Reform UK.
The government predicts that a donation like this would be made just before the next election, so they hope the new legislation can be passed through parliament before then.
Any donation from Musk would need to be made through X.AI London Limited, the British arm of his X company, which hasn’t made any money yet.
The new rules would be part of the Elections Bill, which would enter parliament in the next session. Ministers have told MPs they can expect an update to the plans within months.
Related: Keir Starmer rinses Reform with PMQs zinger after Lee Anderson question