U.S. Protection Division says Tencent and different Chinese language firms have ties to China’s army

The U.S. Protection Division has added dozens of Chinese language firms, together with video games and know-how firm Tencent, synthetic intelligence agency SenseTime and the world’s largest battery maker CATL, to an inventory of firms it says have ties to China’s army.

Lately, Washington has sought to limit sharing of superior know-how, together with semiconductors and AI, deeming it to be a risk to nationwide safety.

The U.S. Protection Division updates its record of “Chinese language Army Firms,” or CMC record, yearly. With the newest revision, it consists of 134 firms. The Nationwide Protection Authorization Act of 2024 bans the Protection Division from coping with the designated firms starting in June 2026.

Tencent’s Hong Kong-traded shares fell 7.3% on Tuesday and the corporate mentioned it could “provoke a reconsideration course of to appropriate this error,” search talks with the U.S. Protection Division and if want be take authorized measures to get it faraway from the record. Tencent is the world’s largest video gaming firm and operates Chinese language messaging platform WeChat.

Firms will search to have resolution reversed

“As the corporate is neither a Chinese language army firm nor a military-civil fusion contributor to the Chinese language protection industrial base, it believes that its inclusion within the CMC Record is a mistake,” Tencent mentioned in an announcement to the Hong Kong Inventory Change.

“Not like different lists maintained by the U.S. Authorities for sanctions or export management measures, inclusion within the CMC Record relates solely to U.S. protection procurement, which doesn’t have an effect on the enterprise of the Group,” it mentioned.

Battery maker CATL mentioned in a press release posted on its web site that the corporate “has by no means engaged in any military-related enterprise or actions,” and mentioned that the designation would not have adversarial impression on its operations.

Like Tencent, CATL maintains that its inclusion to the record was a “mistake” and that it could proactively have interaction with the Pentagon to “deal with the false designation” and take authorized motion if mandatory to guard firm and stakeholder curiosity. CATL’s inventory fell 2.84% in Shenzhen.

AI firm SenseTime mentioned in a press release that the choice to incorporate it on the record had “no factual foundation.”

“We firmly disagree with it,” SenseTime’s assertion mentioned, including that the choice has “no materials impression on our world operations.”

“SenseTime stays firmly dedicated to working collaboratively with the related stakeholders to deal with this matter, and to safeguarding the pursuits of the corporate and our shareholders,” the corporate mentioned.

Throughout a every day information briefing, Chinese language Ministry of International Affairs spokesperson Guo Jiakun urged the U.S. to “instantly appropriate its mistaken practices, and carry the unlawful unilateral sanctions and long-arm jurisdiction on Chinese language firms.”

“China constantly and firmly opposes the U.S. overstretching the idea of nationwide safety, creating discriminatory lists beneath numerous pretexts, and unwarrantedly suppressing Chinese language firms, hindering China’s high-quality improvement,” Guo mentioned.