U.K. Reuters quoted people familiar with the matter and the latest revelations in the documents obtained, saying that on December 3 local time, the Trump administration listed China’s largest chip manufacturer SMIC and the oil giant China National Offshore Oil (CNOOC) as the so-called ” CCP’s military-industrial enterprises” blacklist Reuters said the move may increase tensions between China and the United States before US President-elect Biden takes office.
Earlier, at the press conference on November 30, Chinese Foreign Ministry spokesperson Hua Chunying stated that we have repeatedly stated China’s position on such issues. China firmly opposes the politicization of China’s relevant enterprise cooperation, and hopes that the United States will provide a fair, just, and non-discriminatory environment for the operation of Chinese enterprises, instead of imposing sanctions or discriminatory restrictive measures against Chinese enterprises in the name of national security. Obstacles and barriers are set up for normal exchanges and cooperation.
SMIC: Being included in the list of Chinese military-related companies has no significant impact on operations
SMIC announced on the Hong Kong Stock Exchange that the company has been included in the list of Chinese military-related enterprises and has no significant impact on the company’s operations.
The company reaffirms that the company is an independent international enterprise with investors, customers and other stakeholders all over the world. The company has always adhered to lawful and compliant operations and abided by the relevant laws and regulations of the place of business. Its services and products have never involved any military purposes, and they are all used for civilian and commercial purposes.
The company strongly opposes the decision of the US Department of Defense, which reflects the fundamental misunderstanding of the US Department of Defense regarding the end use of the company’s business and technology. The company will continue to maintain active communication with relevant departments of the US government.
<strong>SMIC: U.S. persons cannot buy the company’s securities after 60 days from today</strong>
SMIC announced on the Shanghai Stock Exchange that on December 4, 2020, SMIC’s IC Manufacturing Co., Ltd. was concerned that the company was included in the list of Chinese military-related enterprises by the US Department of Defense. After the company is included in the list of Chinese military-related companies, Americans will be restricted from trading securities and related derivatives issued by SMIC: 60 days after Beijing time on December 4, 2020, Americans cannot buy the company’s securities; after 365 days, Americans cannot trade the company’s securities. For specific legal restrictions, please refer to the executive order issued by the President of the United States on November 12, 2020.
In less than half a year, the US Department of Defense listed 31 Chinese companies as “owned or controlled” by the Chinese military, paving the way for the United States to impose “sanctions” on them. Reuters exclusively reported on November 29 that the US Department of Defense plans to add four Chinese companies including SMIC and CNOOC to the “blacklist.”
In response, CNOOC Limited responded on the 30th that it has not received any formal notice or decision from relevant US government agencies.
Reuters announced on November 21 that the Trump administration planned to add four more Chinese companies to the “blacklist” of the Ministry of National Defense, but it did not announce which four were. According to the latest so-called “list” given on the 29th, these four Chinese companies include China Construction Technology Co., Ltd. and China International Engineering Consulting Co., Ltd. in addition to SMIC and China National Offshore Oil Corporation.
According to reports, this move has brought the number of Chinese companies on the “blacklist” of the US Department of Defense to 35. However, it is not clear when the new list will be published in the Federal Register, the official US regulatory agency.
The National Defense Authorization Act of the 1999 fiscal year authorizes the Department of Defense to compile a list of companies “owned or controlled” by the Chinese People’s Liberation Army that have operations in the United States, but the Department of Defense will not take action until 2020.
On June 24 this year, the U.S. Department of Defense listed 20 Chinese companies including Huawei, Hikvision, and China Mobile as “owned or controlled” by the Chinese military; on August 28, 11 new companies were added to this list. Chinese companies.
The British “Financial Times” said in June that just being included in the list will not trigger sanctions, but the President of the United States can decide whether to impose sanctions, including blockades of the properties of these companies.
On November 12, the US government began to take action. The White House issued an executive order signed by US President Trump that day, prohibiting US investors from investing in companies related to the Chinese military.
Reuters said at the time that the move was aimed at preventing US investment companies, pension funds and other institutions from buying and selling the shares of these Chinese companies. 31 Chinese companies previously included in the “blacklist” of the Ministry of Defense will all be affected by the ban.
Reuters pointed out on the 29th that the U.S. move and similar policies are considered an attempt to consolidate the outgoing Trump’s tough stance on China, and when anti-China sentiment between the two parties in Congress is high, it “forces the incoming Biden China takes a hard line”. However, some experts believe that the relevant administrative order is unlikely to cause a major blow to related companies because its scope is limited, the Biden government’s position is unclear, and the holdings of US funds are already small.
After the news of being included in the “blacklist” by the US Department of Defense came out, as of the close of trading on the 30th, the share price of CNOOC Hong Kong stocks fell 13.97%. CNOOC Limited announced on the Hong Kong Stock Exchange on November 30 that relevant US government agencies may add the company’s controlling shareholder China National Offshore Oil Corporation (CNOOC) to the blacklist of companies suspected of ties to the Chinese military. . The company has inquired with CNOOC and learned that CNOOC has not yet received any formal notice or decision from relevant US government agencies.
The US Department of Defense plans to include 4 Chinese companies on the “blacklist”? CNOOC responded
SMIC replied to Reuters that the company will continue to “constructively and openly engage with the U.S. government” and its products and services are only for civilian and commercial use. “The company has no relationship with the Chinese military, nor is it Any military end user or end-use manufactured product.”
In September of this year, SMIC also reported that it was included in the “blacklist” by the US Department of Commerce and was subject to export restrictions by the US government. At that time, SMIC replied that it had not received such official information.
With less than two months remaining in office, Trump has recently stepped up its suppression of Chinese companies. Reuters said last week that the United States plans to define 89 Chinese companies as “military-related” companies and restrict their purchases of American products and technologies.
In response to this, Chinese Foreign Ministry spokesperson Zhao Lijian stated at a regular press conference on November 23 that China firmly opposes the unprovoked suppression of Chinese companies by the US and has repeatedly stated its solemn position on this. What the U.S. has done seriously violates the market competition principles and international economic and trade rules that the U.S. has consistently advertised, and will inevitably harm the U.S. national interests and its own image.
Zhao Lijian emphasized that Chinese companies have always adhered to operating in compliance with laws and regulations, and strictly abide by the laws and regulations of various countries, including US laws, in their international operations. The United States should stop the misconduct of generalizing the concept of national security and suppressing foreign companies.