Page:ISC-China.pdf/169



China is interested in the UK Civil Nuclear sector because it offers it the chance to develop its expertise, experience and credibility in the industry, both for domestic and international gain. As previously noted, it will use overt channels in service of these goals, such as exploitation of UK Academia, technology transfer (including via manufacturing license agreements with UK companies), joint ventures, and FDI (including purchasing specialist manufacturers). According to HMG assessment, methods such as these may also be "providing China with *** access to manufacturing and tooling expertise and knowledge".

However, China's involvement also provides it with both incentive and opportunity for espionage. There have been public allegations of systemic espionage and theft of commercially valuable information from the UK and other countries, and charges that this has enabled China to simply re-engineer technology developed by others. These are concerns that should be taken seriously ***. In terms of incentive, *** the JIC assessed:

"The implementation of China's strategy of becoming a global Civil Nuclear supplier, including investment in the UK ***."

*** ***.

In terms of opportunity, the UK Intelligence Community made clear that "Chinese espionage does not depend on inward investment". They noted that:

"the access generated by or through China General Nuclear (CGN) personnel involved in Hinkley Point C (HPC) and Sizewell C (SZC) *** overt and espionage activities."

Nevertheless, China appears to be willing and able to conduct espionage through its investments in CNI, including in the Civil Nuclear sector—we note for instance the Federal Bureau of Investigation (FBI) indictment of CGN in 2016, addressed in the case study of Allen Ho later in this section ***.

There is little doubt that the Chinese state is willing to use intelligence collection to give state-owned enterprises such as CGN a commercial edge, and it is unlikely that CGN is merely a beneficiary of such intelligence; it is believed that ***. Chinese businesses are required to maintain a symbiotic relationship with the Chinese state, as MI5 noted: