The US Department of Defense has once again expanded its list of Chinese military companies.

On January 6, local time, the department added 70 Chinese companies to the 1260H list (CMC list, or Chinese Military Companies List), encompassing a wide range of high-tech sectors such as aerospace, semiconductors, artificial intelligence, drones, information and communication technology, and biotechnology. Notably, Tencent and CATL, two prominent companies, garnered significant attention due to their inclusion on the US sanctions list for the first time. Particularly striking is Tencent Holdings' inclusion, a consumer internet company, which seems anomalous, suggesting either a lack of precision on the part of the Department of Defense or a mere attempt to stir controversy.

However, being on this list may not significantly impact some companies' operations, as it differs from an export sanctions list.

Below are some of the newly added companies and their latest responses:

1. Tencent Holdings Limited

Upon inclusion, Tencent stated that it is not a military industrial company or supplier, describing the decision as "erroneous." Tencent emphasized that the list has no direct impact on its business but will engage with relevant US departments to resolve the misunderstanding.

2. Contemporary Amperex Technology Co., Limited (CATL)

CATL, a global leader in battery manufacturing, responded that "this is a mistake" and stated that the company has never been involved in any military-related activities. CATL plans to use legal means to protect its rights.

3. Quectel Wireless

Quectel Wireless, a communications equipment supplier, issued a statement saying that the company has not cooperated with any military in any country and will request the US Department of Defense to reevaluate this decision.

4. CloudWalk Technology

CloudWalk Technology, an AI technology company, firmly denied the relevant accusations after being included on the list, stating that the decision lacked transparency and fair procedures.

Other companies, such as CXMT, a leading Chinese DRAM chip manufacturer, Autel Robotics, a drone manufacturer, Yangtze Memory Technologies, an important Chinese memory chip manufacturer, SenseTime, a company focused on AI and computer vision technology, and Qihoo 360, a cybersecurity company, have not yet publicly responded to their inclusion on the list.

In addition, major Chinese enterprises like the three major telecommunications operators, Commercial Aircraft Corporation of China, Shanghai Aircraft Manufacturing Co., Ltd., SenseTime, Shenzhen DJI Baowang Technology, CXMT, China Cargo Airlines, COSCO Shipping Group, Shanghai Eastcom, Taiji Computer, and others have also been added to the list.

Previously, an online image circulated claiming that NIO, Alibaba, and Tencent Music were also on the list, but they were not found in the official announcement, likely a hoax.

According to the US Department of Defense notice on the official website of the US federal government, Chief Business Review found that the total number of Chinese companies on the 1260H list reached 134 (including Hesai Technology Co., Ltd.). Notably, the Shanghai International Economic and Trade Compliance Legal Service Platform's official website reported that the Department of Defense recently removed 9 companies, including Megvii Technology and China Railway Construction Corporation.

The 9 removed companies are:

1. Advanced Micro-Fabrication Equipment Inc. China (AMEC)

2. Beijing Megvii Technology Co., Ltd. (Megvii)

3. China Railway Construction Corporation Limited (CRCC)

4. China State Construction Group Co.

5. China Marine Information Electronics Company Limited (China Marine Info Elec)

6. China Telecommunications Corporation (not the listed China Telecommunications Corporation)

7. IDG Capital Partners Co., Ltd. (IDG Capital)

8. SMIC Northern Integrated Circuit Manufacturing (Beijing) Co., Ltd (SMIC NICM)

9. ShenZhen Consys Science & Technology Co., Ltd. (Consys)

Comparing with the official announcement on the US website, we found that 6 of these companies were removed from the list announced this time.

Media reports indicate that several Chinese companies have successfully removed themselves from the list through litigation, including Xiaomi (listed on January 14, 2021, removed on May 25, 2021), AMEC (listed on January 14, 2021, removed on June 3, 2021, relisted on January 31, 2024, removed again on December 18, 2024), Hesai (listed on January 31, 2024, removed on October 17, 2024), and IDG Capital (listed on January 31, 2024, removed on December 18, 2024).

So, how can a company remove itself from the list?

According to the US Department of Defense notice on the official website of the US federal government, Chief Business Review found that companies can also remove themselves from the list by submitting appeals with explanations and evidence demonstrating why they should not be included.

Frankly, this reconsideration process somewhat resembles a "better safe than sorry" approach. For companies to prove they should not be on the list, shouldn't the Department of Defense first explain why they were included? In any case, no detailed explanation was provided in this notice.

Another method could be through legal litigation, but this would involve a lengthy legal battle, consuming considerable time and financial resources.

What is the US Department of Defense's motivation behind these actions?

What do you think? Share your thoughts in the comments section!

References:

https://www.federalregister.gov/documents/2025/01/07/2025-00070/notice-of-availability-of-designation-of-chinese-military-companies

https://www.jmhg.sh.cn/content-detail/?id=1876464687948771329&type=0