The US Department of Defense says Tencent and other Chinese companies have ties to the Chinese military
The US Defense Department has added dozens of Chinese companies, including gaming and technology company Tencent, artificial intelligence company SenseTime and the world’s largest battery maker CATL, to a list of companies it says have ties to the Chinese military.
In recent years, Washington has sought to limit the sharing of advanced technology, including semiconductors and artificial intelligence, as a threat to national security.
The US Department of Defense annually updates its list of “Chinese military companies,” or the CMC list. The last audit includes 134 companies. The National Defense Authorization Act of 2024 prohibits the Department of Defense from doing business with the listed companies beginning in June 2026.
Tencent’s Hong Kong-traded shares fell 7.3% on Tuesday, with the company saying it would “initiate a reconsideration process to correct this mistake”, seek talks with the US Department of Defense and, if necessary, take legal action measures to remove it from the list. Tencent is the world’s largest video game company and operates the Chinese messaging platform WeChat.
The companies will seek the annulment of the decision
“Since the company is neither a Chinese military company nor a military-civilian fusion that contributes to China’s defense industrial base, it believes its inclusion in the CMC list is a mistake,” Tencent said in a filing to the Hong Kong stock exchange.
“Unlike other lists maintained by the US government for sanctions or export control measures, inclusion on the CMC list applies only to US defense procurement, which does not affect the Group’s business,” it said.
Battery maker CATL said in a statement posted on its website that the company “has never engaged in any business or activity related to the military,” and said the appointment would not have a negative impact on its business.
Like Tencent, CATL claims its listing was a “mistake” and will proactively work with the Pentagon to “resolve the false designation” and take legal action if necessary to protect the interests of the company and stakeholders. Shares of CATL fell 2.84% in Shenzhen.
AI company SenseTime said in a statement that the decision to include it in the list “had no basis in fact.”
“We strongly disagree,” SenseTime said in a statement, adding that the decision “has no material impact on our global operations.”
“SenseTime remains firmly committed to working with relevant stakeholders to resolve this matter and protect the interests of the company and our shareholders,” the company said.
During a daily news briefing, Chinese Foreign Ministry spokesman Guo Jiakun called on the US to “immediately correct its wrong practices and end illegal unilateral sanctions and long-standing jurisdiction over Chinese companies.”
“China has consistently and firmly opposed America’s overstretching of the concept of national security, creating discriminatory lists under various pretexts and unjustifiably suppressing Chinese companies, hindering China’s high-quality development,” Guo said.
