U.S. Adds Tencent to Chinese Military Companies Blacklist

[ad_1] The Pentagon on Monday labeled Tencent, the Chinese language social media and gaming large, as a Chinese language navy enterprise working in america, the newest motion in an escalating sequence of retaliatory strikes between the world’s two superpowers.

Tencent’s shares in america plunged by almost 10 p.c following the choice by the Protection Division, which additionally focused Chinese language battery, drone and delivery corporations.

The Protection Division updates yearly an inventory of what it designates as “Chinese language navy corporations,” entities it has recognized as having each navy and industrial know-how. There at the moment are 134 corporations on the record, which was posted to the Federal Register. It additionally added Modern Amperex Expertise Co., generally known as CATL, in addition to models of China Abroad Transport, generally known as COSCO, the chipmaker Changxin Reminiscence Applied sciences and the drone maker Autel Robotics. China Abroad Transport is among the world’s largest delivery strains.

Placing Tencent on the record was “clearly a mistake,” a spokeswoman for the corporate stated in an emailed assertion. “We aren't a navy firm or provider.”

Tencent additionally stated that the itemizing would have “no impression on our enterprise,” and that it could “work with the Division of Protection to deal with any misunderstanding.”

The designation is a warning to companies in america that working with corporations on the record might get them barred from future Pentagon contracts.

To be added to the record, an organization should have some enterprise operations inside america. For instance, CATL is licensing its battery know-how to the American carmaker Ford Motor, which is constructing a $3.5 billion electrical car manufacturing facility in Michigan.

Shares of Tencent, which is listed in Hong Kong, and CATL, which trades in Shenzhen, China, slumped in Asia buying and selling.

CATL didn't instantly reply to a request for remark.

As tensions between the U.S. and China have escalated in recent times, stress has been rising from lawmakers to seek out methods to thwart China’s advances technologically and militarily.

In 2021, the Chinese language shopper electronics firm Xiaomi efficiently sued the Pentagon to be faraway from the blacklist after arguing in federal court docket that it had no ties to the Chinese language navy.

Extra just lately, the nations have engaged in an escalating financial tit-for-tat. It started through the first time period of President-elect Donald J. Trump, after he took goal at China with tariffs and restrictions on commerce. At the moment, Beijing took largely symbolic and measured responses in retaliation.

Since then, the Biden administration has expanded its restrictions on Chinese language corporations and imposed bans on dual-use merchandise, just lately concentrating on 140 Chinese language corporations. On Thursday, the administration stated it was contemplating a brand new rule that might prohibit or ban Chinese language drones in america.

Beijing has adopted an more and more aggressive stance because it prepares for a second presidential time period with Mr. Trump, an outspoken critic of China and its financial would possibly.

Chinese language regulators have introduced an investigation into the American laptop chip firm Nvidia, banned the export of uncommon minerals to america and have taken extra focused swipes at particular person corporations to reveal their provide chain vulnerabilities.