Washington DC: The US has placed several Chinese technology companies, including gaming and social media giant Tencent and battery maker CATL, on its list of firms it claims have connections to China’s military.
The list serves as a caution to American businesses about the potential risks of engaging with these Chinese companies. While inclusion does not automatically result in a ban, it puts pressure on the US Treasury Department to impose sanctions on the firms.
Tencent and CATL have denied any involvement with the Chinese military, with Tencent labelling its inclusion on the list as “clearly a mistake.” Tencent, which owns the popular messaging app WeChat, stated that it is “not a military company or supplier” and that the listing would not affect its business operations.
CATL also rejected the designation, claiming that it “is not engaged in any military-related activities.” The company criticized the US for undermining market competition principles and international trade rules, arguing that such actions damage foreign companies’ confidence in investing in the US.
The Pentagon’s list, formally known as the Section 1260H list, is updated annually and now includes 134 firms. It is part of the US’s broader strategy to counter China’s increasing military power, which Washington believes is supported by technology and expertise from Chinese firms, universities, and research programs.
The decision comes amid pressure from US lawmakers to include specific firms like CATL on the list, especially as US carmaker Ford announced a $2bn investment in Michigan to build a battery plant and plans to license technology from CATL. Ford did not immediately respond to a request for comment.
This move reflects the ongoing tensions between the US and China. Additionally, President-elect Donald Trump, who has previously taken a tough stance against Beijing, is set to return to the White House this month.
The Pentagon has also faced legal challenges from drone maker DJI and Lidar maker Hesai Technologies, which were added to the list last year and remain there in the updated version.
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