The US Department of Defense has added Chinese giants Tencent and CATL to its list of companies it believes have ties to Beijing’s armed forces. Tencent (tech) and CATL (batteries) appear in an updated list which must be published on Tuesday in the official journal, and available for consultation on Monday.
Tech giant Tencent is among the largest game creators in the world and is the operator of the WeChat application, omnipresent in China. The Chinese technology giant’s shares fell 7% at the opening of the Hong Kong stock market, after its listing on the American list.
The Chinese battery manufacturer CATL, also placed on the list, saw its price fall by 5.2%. CATL produces more than a third of the electric car batteries sold worldwide, including to equip vehicles from Mercedes-Benz, BMW, Volkswagen, Toyota, Honda and Hyundai.
Damage to reputation
Under a 2021 law, the US Department of Defense must identify Chinese military companies with direct or indirect interests in the United States and submit the list to Congress. He must also publish the unclassified part of the list in the official journal. Being included there has no legal consequences for the companies in question but it damages their reputation. In the past, some groups have filed complaints after appearing there.
-“The inclusion of Tencent in this list is obviously an error, we are neither a military company nor a supplier,” reacted a spokesperson for the Chinese giant. “Unlike sanctions or export controls, this list will have no impact on the operation of the company,” added the spokesperson, stressing however that Tencent would work with the Pentagon to “clarify everything misunderstanding”.
The United States considers China its main rival. For years, Washington has taken national security protection measures targeting tech companies for fear that their know-how could be used by Beijing for military purposes.
The announcement led to a fall in shares of Tencent (-7%) and CATL (-5.2%) at the opening of the Hong Kong Stock Exchange on Tuesday, where the Hang Seng index opened down almost 1%.
