MPs summon chiefs of Chinese-owned UK-based tech firm amid fears coronavirus crisis is being used as 'cover' to shift control of security software to Beijing after CEO quits and senior Tories demand a 'reckoning'

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MPs are summoning the chiefs of a Chinese-owned UK-based IT firm amid fears control of crucial security software could be shifted away from US and British regulation under the cover of coronavirus, it was revealed today.

The Foreign Affairs Select Committee, chaired by Tory Tom Tugendhat, wants answers from Imagination Technologies over claims it has reneged on agreements with the government.

The company was originally founded in 1985 and makes microchips which are used in products including Apple smartphones. 

The company was bought in 2017 for £550 million by the private equity firm Canyon Bridge which was US-based but is effectively Chinese state-owned. 

Mr Tugendhat said that purchase had been given the green light by Theresa May's government on the grounds that Canyon Bridge was licensed and regulated by US law.

But since then it has moved its headquarters to the Cayman Islands which means it is no longer a US-regulated entity. 

MPs are concerned that Imagination Technologies' owners could now try to shift some of the company's sensitive technology patents to mainland China.

It comes amid rising Tory anger about the involvement of Chinese firms in key UK sectors with the government facing calls to curb Beijing's influence. 

Some MPs are demanding a reset in relations with the Chinese government because of the coronavirus crisis due to doubts about the death figures published by Beijing. Downing Street sources have previously suggested the regime faces a 'reckoning' after the pandemic is over. 

Imagination Technologies HQ on the outskirts of London. MPs have today summoned the firm's bosses to answer security questions

Tom Tugendhat, the chairman of the Foreign Affairs Select Committee, is demanding answers from the firm 

The select committee's demand for the company to give evidence comes after several senior executives - including the chief executive Ron Black - stepped down apparently over the direction of the firm. 

The BBC reported that chief product officer Steve Evans recently stepped down and said in his resignation letter: 'I will not be part of a company that is effectively controlled by the Chinese government.'

The firm's chief technical officer John Rayfield is also believed to have recently quit. 

Canyon Bridge's main investor is China Reform Holdings, a Chinese state-owned company.

China Reform reportedly recently tried to stage a boardroom coup to take control of Imagination Technologies but the attempt was aborted.

Some MPs are worried that the current coronavirus crisis is effectively being used by the Chinese state as cover to pursue controversial technology transfers. 

It comes amid growing disquiet in Westminster about the involvement of Chinese firms in key sectors, with the government still under pressure to reverse its decision to allow Huawei a role in building Britain's 5G network.

Mr Tugendhat told the BBC that he was worried software developed by Imagination Technologies could be used in the design of so-called 'backdoors' into the UK's critical digital infrastructure.

He told the broadcaster: 'They make an extremely high end processing system, some of the most advanced graphics in the business.

'They also have developed various cyber technologies including being able to identify various forms of cyber attack that would be extremely useful to a hostile state actor.

'This isn't just about back doors. Just as in the 19th century concepts of accountancy and law wrote into the international community a trading architecture, so today the danger is what we see is an authoritarian dictatorship like China coding into the international architecture state control, violations of privacy and indeed suppression of individual rights that frankly many of us are deeply concerned about.'

Mr Tugendhat added: 'The world has changed and companies - particularly tech companies - are on the frontline.

'Whoever writes the code, writes the rules for the world, more than any regulation passed by bureaucrats. 

'There's no point in taking back control from Brussels, only to hand it over to Beijing.' 

In response to being summoned by MPs, a spokesman for Imagination Technologies said: 'We welcome the opportunity to respond directly to any questions the committee may have and address any misunderstandings.' 

Former Tory leader Sir Iain Duncan Smith said at the weekend that the UK government needed to take action to stop the 'drift into over-dependence on China for so many of the products and systems which run our lives'.

Writing for the Mail on Sunday he said: 'China's utter dominance of the computer and mobile phone market where, from microprocessors to lap tops and from mobile phones to antennae, China now dominates the global market. 

'Worse, the government will add to this dominance by including Huawei in our new 5G system.

It came as Imagination Technologies' chief executive Ron Black (pictured) quit in the wake of attempts by Beijing-linked China Reform Holdings to seize control of the firm

Tory former leader Sir Iain Duncan Smith is urging the government to curb the involvement of Chinese firms in key UK sectors 

'This dominance is because the totalitarian government of China has implemented strategic plans to secure these markets for China, one by one. 

'Of course, this has been made easier by our complacency, our rush for cheaper and cheaper products and the absence of a government strategic view about crucial areas of production.'

The US has urged its allies not to use Huawei products because of security concerns - concerns vehemently rejected by the tech giant. 

The government announced in January that the firm would be allowed to help build non-core parts of the nation's 5G network. 

The decision reportedly prompted US President Donald Trump to vent 'apoplectic' anger at Boris Johnson during a phone call at the start of February. 

Tory MPs are now pushing for the government to reverse the Huawei decision and to commit to a goal of removing the company from involvement in the 5G infrastructure within the next few years.