HONG KONG (AP) — The U.S. Defense Department has recently expanded its list of Chinese companies with alleged ties to the country's military, a move that has sparked backlash and calls for a reversal of the decision. Notable additions to the list include Tencent, a prominent games and technology company, artificial intelligence firm SenseTime, and CATL, the world's largest battery manufacturer.
The U.S. government has been increasingly vigilant in restricting the transfer of advanced technologies, such as semiconductors and artificial intelligence, citing national security concerns. The Defense Department updates its list of 'Chinese Military Companies' annually, with the latest revision now encompassing 134 entities. The National Defense Authorization Act of 2024 prohibits the Department of Defense from engaging with the designated companies starting in June 2026.
Following the announcement, Tencent's shares in Hong Kong experienced a 7.3% decline. The company expressed its intention to challenge the decision, stating that it is not affiliated with the Chinese military or involved in military-civil fusion activities. Similarly, CATL emphasized that it has never conducted military-related business and vowed to contest its inclusion on the list.
SenseTime, another company on the list, refuted the designation, asserting that it lacks any factual basis. Despite being added to the list, the company affirmed that the decision would not significantly impact its global operations.
In response to the U.S. actions, the Chinese Ministry of Foreign Affairs condemned the move, urging the U.S. to rectify what it deemed as wrongful practices and lift sanctions on Chinese companies. The Ministry criticized the U.S. for extending the notion of national security beyond reasonable bounds and impeding China's progress.
