US adds Chinese tech giants to list of companies allegedly working with China’s military

Hong Kong CNN —

The US Department of Defense has added Chinese tech companies Tencent, a social media and gaming giant, and CATL, the world’s largest battery maker, to a list of firms that it alleges work with China’s military.

Inclusion on the Pentagon list does not result in any immediate sanctions, but it could affect the reputations of the companies named and hinder their commercial progress, particularly if they want to do business in the United States.

Shares in Tencent, which owns Chinese super-app WeChat, were 6.5% lower in Hong Kong on Tuesday, while CATL’s Shenzhen-listed shares lost more than 3%.

They join dozens of other alleged Chinese military companies on the list that the Defense Department alleges operate directly or indirectly in the US, according to a notice posted to the Federal Register on Monday.

The Pentagon has said the so-called 1260H list, which is updated annually, is “an important continuing effort” in highlighting and countering China’s “military-civil fusion” strategy, a goal to develop the most technologically advanced military in the world by eliminating barriers between the country’s civilian research and commercial sectors and its armed forces.

In a statement to CNN, Tencent called its inclusion on the list “a mistake.”

“We are not a military company or supplier. Unlike sanctions or export controls, this listing has no impact on our business. We will nonetheless work with the Department of Defense to address any misunderstanding,” a spokesperson said.

CNN has reached out to CATL, which supplies batteries to Tesla and plans to provide its “knowledge” and services to Ford to make lithium-ion batteries at a plant in Michigan, for comment.

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