(Minghui.org) The U.S. Department of Defense added four additional companies to a blacklist of Chinese military companies on December 3, 2020.
These four companies are owned or controlled by the Chinese military, including China’s top chipmaker SMIC, oil giant CNOOC, China Construction Technology Co Ltd, and China International Engineering Consulting Corp. The additions brought the number of blacklisted Chinese companies to 35.
The list of “Communist Chinese Military Companies” was mandated by a 1999 law (Section 1237 of the National Defense Authorization Act) requiring the Pentagon to compile a catalog of companies “owned or controlled” by the People’s Liberation Army.
The U.S. Department of Defense released its first list on June 20, 2020, designating 20 Chinese companies as owned or controlled by the Chinese military. Most of these companies are Chinese state-owned companies covering aviation, communications, nuclear power, ships and other fields. Companies such as Huawei, China Telecom and China Mobile are also included in the blacklist. On August 28, the Pentagon designated 11 other Chinese companies as companies owned or controlled by the Chinese military, laying the foundation for further sanctions.
On November 12, U.S. President Donald Trump signed an executive order aiming to stop U.S. investments from flowing into companies with ties to the Chinese military. This will prevent U.S. investors from buying the firms’ securities from early next year.
The order was aimed at preventing American capital from being used to fund the Chinese regime’s military development. It stated that Beijing uses ostensibly private companies to support military and intelligence activities under the strategy of “civil-military fusion.”
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 legislation to ban blacklisted Chinese companies from U.S. capital markets.
According to Fox News, Rep. Mike Gallagher introduced new legislation on November 20 that aims to ban Americans from investing in Chinese companies and individuals listed on the Commerce Department’s so-called Entity List of firms facing U.S. restrictions.
“We’ve seen that the Chinese Communist Party is engaged in a relentless campaign to dominate critical technologies,” Gallagher told Fox News. “As we've seen time and again, CCP exploits our fair and open system in order to dominate those technologies using American capital to finance its malign agenda.”
He continued, “To make matters worse, the financing is coming not just from big Wall Street banks and hedge funds but from unwitting Americans whose hard-earned investments are caught up in mutual funds, retirement [funds] and things like that, and I think this poses a direct threat to our economic security and national security.”
The congressman praised the president's executive order but said the American Financial Markets Integrity and Security Act goes a step further by prohibiting all Chinese companies on the Entity List from listing on U.S. exchanges and receiving U.S. investments.
The bill also restricts those companies from using federal funds, as well as investments from U.S. insurance companies and retirement funds.
“The ultimate goal is to ensure that an increasingly hostile foreign power isn’t using the American economy against us–isn't using Americans’ hard-earned money to finance or build weapons ... that could be used against our armed service members in a future conflict,” Rep. Gallagher said.
On December 2, the U.S. House of Representatives approved the Holding Foreign Companies Accountable Act, which requires Chinese companies to strictly abide by American inspection standards to be able to list or trade on the American stock exchange.