The U.S. Department of Defense has added Tencent, a gaming and social media giant, and CATL, the largest battery manufacturer in the world, to its list of companies allegedly linked to China’s military.
According to the DOD report, both companies are “”Chinese military companies” operating directly or indirectly in the United States in accordance with the statutory requirement of Section 1260H of the National Defense Authorization Act.”
Both companies claim the listing is a “mistake.”
“We are not a military company or supplier. Unlike sanctions or export controls, this listing has no impact on our business. We will nonetheless work with the Department of Defense to address any misunderstanding,” a Tencent spokesperson said.
CATL, a supplier of batteries to Tesla and Ford, made a statement claiming that it “has never engaged in any military-related business or activities, so this designation by the Department of Defense is a mistake.”
The companies listed by the DOD do not face immediate sanctions from the Pentagon; however, inclusion could harm their reputations and potentially affect their business prospects in the United States.
Following the announcement, Tencent’s shares dropped 6.5% in Hong Kong, and CATL’s shares fell over 3% in Shenzhen. The companies have stated they are prepared to address the issue, possibly through legal action.
By CEO NA Editorial Staff
