The inclusion of Tencent and CATL on a U.S. military-linked companies list has sparked tensions, with both companies denying military ties and China decrying the decision as an attack on its enterprises.
US Targets Tencent and CATL Amidst Rising Tensions with China
US Targets Tencent and CATL Amidst Rising Tensions with China
The U.S. has added Tencent and CATL to its list of companies allegedly linked to China's military, raising concerns about international business relations.
The U.S. government has recently included Chinese tech giants Tencent and CATL on a list of businesses reportedly associated with the Chinese military. This action serves as a warning to U.S. companies and organizations about potential risks tied to engaging with these Chinese entities. While this designation does not lead to an immediate ban, it puts additional pressure on the U.S. Treasury Department to consider sanctions against the involved firms.
Tencent, well-known for owning the popular messaging app WeChat, and CATL, a prominent battery manufacturer, have both denied allegations of military affiliations. Tencent characterized its inclusion on the list as "clearly a mistake," asserting, "We are not a military company or supplier." CATL echoed these sentiments, emphasizing that it is not involved in any military-related activities. Supporting these claims, Liu Pengyu, a spokesperson for the Chinese embassy in Washington, criticized the U.S. decision as irrational suppression that infringes upon fair market competition and could deter foreign investment in the U.S.
The list in question, formally known as the Section 1260H list, is annually updated by the Department of Defense (DOD) and currently comprises 134 firms. This initiative aligns with Washington’s broader strategy to curtail what it perceives as Beijing's attempts to bolster its military capabilities through technology provided by domestic companies, research institutions, and universities.
The announcement follows increasing pressure from U.S. lawmakers to sanction specific firms, particularly in light of Ford's announcement regarding a $2 billion investment aimed at building a battery plant in Michigan, which includes plans to license technology from CATL. The company reportedly has yet to provide comments regarding the impact of this list on its business operations.
This development occurs against a backdrop of deteriorating relations between the U.S. and China, with both nations navigating significant geopolitical tensions. Additionally, incoming President Donald Trump, known for his tough stance on China, is set to take office this month, further complicating diplomatic interactions.
Notably, the Pentagon faced lawsuits last year from drone manufacturer DJI and Lidar company Hesai Technologies concerning their inclusion on this list; both firms remain officially categorized as military-linked entities.
