"The university said the leader of a project had been told only UK passport-holders should be involved in talks on national security and foreign trade."
Well, it states it is a national security / foreign trade issue which I feel is accurate regarding Brexit. I don't view it as racist to not allow foreigners to influence the government on national security issues since the UK is a sovereign country that has interests which clearly conflict with the interests of many EU countries.
Most Western countries have laws to prevent that from happening, including the US. (even accepting foreign donations for election campaigns is limited or forbidden in some cases)
