Because of concerns about national security risks, the UK has blocked a Hong Kong firm from acquiring an electronic design firm.

Super Orange HK had attempted to buy Bristol-based Pulsic.

However, the government stated that tools could be used to “build defense or technological capabilities.”

According to the Chinese embassy, the UK should provide a fair and “non-discriminatory environment” for Chinese companies.

This is the latest attempt to limit Chinese investment in British companies and technology.

Chinese mobile provider Huawei was barred from the UK’s 5G infrastructure in 2020 due to national security concerns, which the company denied.

The government is also considering a Chinese-backed takeover of Newport Wafer Fab, Britain’s largest microchip factory.

The most recent takeover attempt was thwarted by the National Security and Investment Act, which went into effect in January.

It empowers the government to scrutinize and intervene in commercial transactions in order to protect national security.

The software developed by Pulsic could be used “to facilitate the building of cutting-edge integrated circuits that could be used in a civilian or military supply chain,” according to the Department for Business, Energy, and Industrial Strategy.

The decision to halt the takeover was described as “necessary and proportionate to mitigate the risk to national security.”

“Any abuse of national security review will only harm the UK’s investment environment and long-term interests,” the Chinese embassy in the UK stated.

Pulsic has not yet responded to a request for comment. The company has offices in Bristol, Newcastle, Tokyo, and San Jose.

Super Orange HK did not respond to requests for comment. The Chinese Embassy in the United Kingdom was contacted for comment.

Liz Truss, a Conservative leadership candidate, has stated that Beijing’s “increasing assertiveness” is a “deep security concern.”

“We should take precautions to avoid exporting technology that could be used against us. We need to pass investment screening, which we’ve developed to ensure that we don’t acquire key strategic assets. “On Wednesday, the foreign secretary addressed a leadership husting.

She has also stated that the UK should crack down on Chinese-owned businesses such as the social media platform TikTok.