CHINA
- Since 2017, the majority of Chinese investment in the UK appears to have been strategically driven, with clear links between areas of investment and Chinese state objectives. When we questioned the Intelligence Community on this, the JIC Chair emphasised the importance that China places on the UK as a centre of scientific and technological excellence, noting that the UK has world-class research and development (and, in some cases, industrial activity) in many of the technologies mentioned in the 'Made in China 2025' strategy.[1] Chinese science and technology requirements therefore correspond closely to UK strengths in military capabilities, and industrial and emerging technology.
- The UK sectors of particular interest to the Chinese include defence, telecommunications, new or emerging digital technologies and other strategic industries not necessarily part of the UK's Critical National Infrastructure (CNI), but which are nevertheless considered sensitive (for example ***).[2] Director General MI5 told us:
***[3]
What does China target in the UK?
- When targeting UK Industry, China has two key priorities: the acquisition of IP and technology, and the acquisition of data.
Acquisition of Intellectual Property and technology
- Intellectual Property (IP) refers to creations of the mind, such as inventions, literary and artistic works, designs and symbols, and names and images used in commerce. IP rights give the creator an exclusive right over the use of his/her creation for a certain period of time and enable him/her to earn recognition or financial benefit from what they invent or create. IP is protected in law in various ways.[4]
- China's apparent unwillingness to recognise (or enforce) IP rights has been an issue since the country 'opened' to the world in the 1970s. Originally, this was centred on copyright and trademark infringement with pirate DVDs, CDs and counterfeit goods being readily produced by Chinese companies. Today, it is focused on much higher value goods, in particular cutting-edge technology. However, the same principle applies—by stealing IP, the Chinese save money on research and development, thereby lowering the overall 'to-market' cost so that they can undercut the original product and dominate the market.
- ↑ Oral evidence—JIO, *** July 2019.
- ↑ Written evidence—JIO, 10 August 2020.
- ↑ Oral evidence—MI5, *** October 2020.
- ↑ Copyright covers artistic content, which includes novels, plays, poems, films, music, drawings, paintings, photographs, sculptures, maps, technical drawings and architectural design. Copyright allows creators to retain control over the use of their material, authorising or prohibiting its performance, display or reproduction. Patents are exclusive rights to an invention (defined as a product or process which provides a new way of doing something or a new technical solution to a problem). Patents provide protection against an inventor's creation being made, used, distributed or sold without the inventor's consent. Trademark protection allows the owner of a trademark to use it exclusively to identify goods or services they (or someone they have licensed to use their trademark) produce or provide. Industrial Design protection is used to protect aesthetic, rather than technical, inventions (i.e. the way a product looks, not the way it works, which would be covered by a patent).
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