UK signals national security concerns over Chinese ownership of Scottish semiconductor company

On November 26, 2024, the UK government issued an order for FTDI Holding Limited, a company linked to China, to divest its ownership of Future Technology Devices International Limited (FTDI), which is a Scottish fab-less semiconductor firm. The decision was made by the Cabinet Office as a measure to safeguard national security and address possible threats linked with UK-developed semiconductor technologies. FTDI is headquartered in Glasgow, with additional research and development operations in Singapore. The intervention followed concerns regarding the use of FTDI's semiconductor technology and intellectual property in ways that could pose risks to the UK’s national security and critical infrastructure, particularly systems relying on FTDI products. This move by the UK government forms part of broader measures that have been enacted since January 2022, which include blocking or imposing conditions on over 20 foreign acquisitions involving sensitive technologies and critical infrastructure. In light of these actions, it becomes evident that the UK is consistently assessing foreign investments to ensure that such acquisitions do not compromise national interests. With the backdrop of increasing global scrutiny on foreign ownership of technology firms, particularly in sectors deemed essential for national security, the UK government's decision illustrates its proactive approach in addressing the vulnerabilities posed by foreign investments. This trend aligns with similar actions taken by other countries concerned about technological sovereignty, including the United States and several EU nations. FTDI’s ownership is particularly concerning due to its implications on critical national infrastructure that utilizes its products. The UK government has emphasized that foreign control of technologies integral to national security cannot be allowed, and it intends to follow through with the divestment to ensure that FTDI’s operations remain aligned with UK security interests. The overall landscape for foreign investments in technology firms is evolving rapidly, and the UK's stance reiterates the need for transparency and careful scrutiny in international acquisitions related to critical technologies.