In a startling revelation, it appears that two premier Chinese artificial intelligence chip designers, now subject to strict US export sanctions, previously gained extensive access to cutting-edge microchip technology from the UK firm Imagination Technologies. This has raised grave concerns about the potential for sensitive British IP finding its way into advanced Chinese weapons systems.
Jewel of UK Tech Grants Broad Licenses to Chinese Firms
Regarded as a crown jewel of British innovation, Imagination Technologies is one of a select few companies worldwide designing the advanced GPUs that power AI systems. But prior to their blacklisting by the US in 2023, Chinese companies Moore Threads and Biren Technology secured comprehensive licensing deals with the UK firm, according to insider sources.
At no stage has Imagination considered or implemented transactions with third parties to enable China or any other nation state to use our technology for military end uses.
– Imagination Technologies Spokesperson
While Imagination confirms the existence of the licenses, it firmly denies any claims of deliberately transferring state-of-the-art secrets to China under the ownership of a Chinese state-backed private equity fund. The company states its licensing was solely focused on consumer electronics and automotive markets and prohibits military applications.
Inside the “Knowledge Transfer Programs”
However, two former high-level employees allege that the “knowledge transfer programs” which accompanied the Chinese licenses were so extensive in sharing Imagination’s unique expertise, that they potentially gave the recipients the ability to replicate the British firm’s cutting-edge technology.
For each license there was an agreement worth millions to essentially teach them step-by-step how to develop the GPU and modify our designs. Very difficult to deny that technology transfer was an obvious outcome.
– Former Imagination Technologies Insider
Imagination counters that the multi-year engineer training arrangements starting around 2021 were normal for the industry, limited in scope and duration. But both whistleblowers departed before seeing the full extent of the knowledge sharing, deeply concerned about the risk of enabling the Chinese to replicate Imagination’s proprietary designs.
Blacklisted Over Weapons Fears, but Damage Already Done?
The controversy is exacerbated by the fact that in late 2023, after the licensing deals, both Moore Threads and Biren Technology were placed on the US government’s export blacklist. Washington cited grave concerns over the companies’ development of AI chips that “can be used in advanced weapons systems” and surveillance tech that “poses national security risks.”
While Imagination does not believe its IP met the threshold for weapons applications and claims its contracts banned military use, experts say it’s extremely difficult to be certain that transferred chip design knowledge won’t ultimately contribute to concerning use cases like autonomous weapons once out of the company’s hands.
Questions Arise Over Imagination’s Chinese Ownership
Some place blame on the 2017 acquisition of Imagination by Canyon Bridge, a private equity firm funded by Chinese state money, which the UK government approved despite the US blocking a similar attempted purchase of an American chip company. Former Imagination CEO Ron Black, who departed in 2020 after opposing Chinese control, claimed he warned UK national security officials of his fears that “China Reform,” the state body backing Canyon Bridge, aimed “to steal the technology.”
While Black’s concerns helped stop the appointment of China Reform directors to Imagination’s board, insiders allege that after his exit, the “clear strategy was to get technology transfer to Chinese companies” via the extensive knowledge sharing arrangements. Imagination firmly rejects these claims.
Lack of Transparency Breeds Suspicion
Adding to the confusion are questions around how forthcoming the Chinese licensees have been. Industry analysts note that Moore Threads’ claims of independently developing China’s first homegrown GPUs appear to gloss over “key pieces” coming from its Imagination deal. Similarly, Biren’s receipt of funding from a Russia-China investment fund raises eyebrows. Neither company responded to requests for comment.
As the China-UK technology transfer saga unfolds, it underscores the immense complexity of drawing boundaries between commercial ambitions and national security imperatives in an era of escalating techno-nationalism. Untangling the web of Chinese state influence, private capital, sensitive dual-use innovations, and legitimate tech collaboration is proving to be one of the defining challenges western policymakers, corporations and defense establishments.
The shocking revelations also highlight the critical importance of robust due diligence, proactive IP protection measures and muscular export control regimes to prevent strategically vital knowledge from falling into the hands of geopolitical rivals. For while Imagination may strenuously object to allegations of complicity in any nefarious transfer, the mere perception of impropriety can be immensely damaging in a tech sector increasingly intertwined with national security.
As the old adage goes, the genie is not easily put back in the bottle. Technologists and policymakers alike are left grappling with how to balance the realities of globalized innovation with the imperative to safeguard their societies’ most precious intellectual gems. The Imagination saga may be just the tip of the iceberg.
