U.S. Defense Department Flags Chinese Tech Giants for Military Ties

The U.S. Defense Department added Chinese companies such as Tencent and CATL to a list of firms with alleged military ties. Some firms, including Tencent and CATL, deny these claims. The list reflects ongoing tensions and aims to highlight security risks posed by Chinese corporations.

The U.S. Defense Department has announced the inclusion of several Chinese tech giants, including Tencent Holdings and CATL, in its updated list of firms it alleges are linked to China's military efforts. Other notable additions are chip maker Changxin Memory Technologies, Quectel Wireless, and Autel Robotics, as per a document released on Monday.

This list, known as the 'Section 1260H list,' comprises 134 companies this year and is designed to disclose firms believed to be aligning with China's military ambitions. The inclusion has affected companies like Tencent, which saw its shares decline by 8%. Tencent responded, stating the decision was a 'mistake' and insisting it is not tied to military operations.

Amid mounting tensions between the U.S. and China, these actions underscore growing apprehension about security risks associated with Chinese companies. Expert Craig Singleton noted that the list amplifies concerns over the sensitive technologies being developed. The updates might influence U.S. firms on their dealings with these entities, raising questions about future sanctions.

(With inputs from agencies.)