According to sources familiar with the matter at hand, the United States is slated to designate four more Chinese companies as being backed by China’s military thus curbing their access to U.S. investor funds.
The previously unreported designations of the Chinese companies, could be released by the Department of Defense later this week or early next week, said a source.
With this latest additions, the number of Chinese companies added to the Entity List totals to 35 and includes large Chinese firms such as China Telecom Corp, Hikvision, and China Mobile.
While the list of “Communist Chinese Military Companies” was mandated by a 1999 law which required the Pentagon to compile a list of companies “owned or controlled” by the People’s Liberation Army, the DoD complied only this year.
The development comes in the wake of the White House publishing an executive order which adds more teeth to the trade black list by prohibiting U.S. investors from buying securities of these blacklisted companies starting from November 2021.
The move “helps ensure no American is unwittingly subsidizing the (Chinese Communist Party)’s campaign to dominate the technologies of the future,” said Republican Congressman Mike Gallagher, who introduced the legislation to ban blacklisted Chinese companies from U.S. capital markets.
It is to be seen how the executive order will impact the companies given that the incoming Biden administration has soft corners for Communist China.
President-elect Joe Biden, who will take office on January 20, has yet to publicly lay out his detailed China strategy. The development comes even as China tries to obfuscate the source of the Wuhan coronavirus and continues its crackdown on civil liberties in Hong Kong.
The list is also part of a broader effort by Washington to target what it sees as Beijing’s efforts to enlist corporations to harness emerging civilian technologies for military purposes.