DoD China Blacklist Swells

The Department of Defense has released an update to the names of "Chinese military companies" operating directly or indirectly in the United States. While not directly impacting the firm's business prospects, the designation fogs the optics of some large partnerships between American manufacturers and their Chinese business partners.

CATL, the world's largest electric vehicle battery maker, said it was "not engaged in any military-related activities".  The firm is supplier for  General Motors, Volkswagen, BMW, Tesla, Daimler’s electric buses and trucks, as well as many Chinese EV manufacturers.    

House Select China Committee Chair John Moolenaar (R-MI) has repeadedly called for Treasury Secretary Janet Yellen to withhold any federal support for Chinese battery companies in the United States [see 10093].  This summer Moolenaar and colleagues called for the Department of Homeland Security to ban Chinese battery firms for participating in "Chinese Communist Party state-sponsored slave labor and the ongoing Uyghur genocide."  [12704

Other firms added include

Tencent Holdings,  a major Chinese multinational technology and entertainment conglomerate. It is primarily known in the U.S. for:

• WeChat: A ubiquitous messaging, social media, and mobile payment platform in China. While less popular in the U.S., it has a niche user base, particularly among Chinese-speaking communities.
• Gaming Investments: Tencent owns or holds significant stakes in prominent gaming companies, including Riot Games (developer of League of Legends), Epic Games (developer of Fortnite), and others like Activision Blizzard and Ubisoft.
• Entertainment and Cloud Services: Tencent also has investments in global media streaming platforms and cloud technology.

Changxin Memory Technologies (CXMT), a Chinese semiconductor company specializing in dynamic random-access memory (DRAM). While relatively unknown to the average American consumer, it plays a strategic role in China’s semiconductor industry as a competitor to U.S.-based companies like Micron Technology in memory chip production.

Quectel Wireless Solutions is a global leader in Internet of Things (IoT) solutions. It develops and manufactures cellular modules, including 5G, LTE, and LPWAN modules, used in IoT devices, connected vehicles, industrial IoT, and consumer electronics.

Included in the list is China's largest shipping company COSCO Shipping Holdings 

Reuters reports the Chinese foreign ministry told a daily briefing on Tuesday that it urged the U.S. to immediately lift "illegal unilateral sanctions" against Chinese enterprises, adding that China would safeguard the legitimate rights and interests of its companies.

Updating the Section 1260H list of "Chinese military companies" is an important continuing effort in highlighting and countering the PRC's Military-Civil Fusion strategy, according to the DoD release.

The PRC's Military-Civil Fusion strategy supports the modernization goals of the People's Liberation Army (PLA) by ensuring it can acquire advanced technologies and expertise developed by PRC companies, universities, and research programs that appear to be civilian entities.

Section 1260H of the William M. (“Mac”) Thornberry National Defense Authorization Act for Fiscal Year 2021 (Pub. L. 116-283) directs the Department to begin identifying, among other things, Military-Civil Fusion contributors operating directly or indirectly in the United States.

The Department will continue to update the list with additional entities as appropriate. The United States Government reserves the right to take additional actions on these entities under authorities other than section 1260H. The list is available here.

Notice of Availability of Designation of Chinese Military Companies. by the Defense Department on 01/07/2025.