A review into the planned takeover of a Newport company by a Chinese-owned firm has not been started, despite the Prime Minister's assurance he had commissioned such a report. Concerns have been raised about the takeover of Newport Wafer Fab by Nexperia, a company with links to the Chinese Communist Party, over fears it could compromise national security.
The Commons' Foreign Affairs Committee says that the Prime Minister said he had commissioned such a review but "in the absence of any evidence to the contrary, the assumption is that the National Security Adviser’s review has not been started". You can read the background to the deal here.
In July 2021, Boris Johnson said he had asked his national security adviser to review the purchase. Speaking to MPs on parliament’s liaison committee, Johnson said: “I think semiconductors are of huge importance to this country, and one of the things I wanted to look at immediately when I became prime minister was whether or not we could become more self-reliant. We have to judge that the stuff that they are making is of real intellectual property value and interest to China, whether there are real security implications."
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Chair of the Foreign Affairs Committee, Tom Tugendhat MP said: "We are, seemingly, handing over critical security infrastructure to overseas companies with well-documented links to the Chinese state." He added: "So few details have been provided to the Committee, that we are left with the unfortunate conclusion that no review has taken place. Today, the Committee is calling on the Government to clarify the reasons why the Prime Minister requested a review in Newport Wafer Fab and why this review has not begun.
Newport Wafer Fab is one of the country’s largest manufacturers of semiconductors. Newport Wafer Fab employs 470 people and Nexperia is wholly owned by Chinese tech firm Wingtech. The UK Government has said semiconductors are critical to the UK’s national security and wider global interests but there are worries about the sale of one of the UK’s prized assets to a strategic competitor.
A report today from the committee says it wants an update and to know the circumstances in which the National Security Adviser is engaged in reviews under the National Security and Investment Act or Enterprise Acts; the reasons why the Prime Minister asked the National Security Adviser to undertake a review of Newport Wafer Fab; why the National Security Adviser did not undertake such a review.
Mr Tugendhat said: "For over a year, the Committee has voiced its concern over the takeover of semiconductor manufacturer Newport Wafer Fab. The National Security and Investment Act has been in place for over three months yet we’ve seen no evidence of its use.
"Semiconductors are essential to every aspect of modern life and Newport Wafer Fab is one of the country’s leading manufacturers. Their takeover by Nexperia left many wondering why we are, seemingly, handing over critical security infrastructure to overseas companies with well-documented links to the Chinese state.
"The long-term security of our nation relies not just on our Armed Forces but on the resilience of our economy and that means ensuring our future stability is never sacrificed for the sake of short-term advancement.
"The Prime Minister’s assurances that work is underway are welcome. However, so few details have been provided to the committee, that we are left with the unfortunate conclusion that no review has taken place. Today, the Committee is calling on the Government to clarify the reasons why the Prime Minister requested a review in Newport Wafer Fab and why this review has not begun. The Government has the tools, it just needs to use them."
