National Security

Trump Admin Says Chinese Military Is Backing Huawei and Other Top Firms

Huawei
Reuters

By Alexandra Alper, Idrees Ali

WASHINGTON (Reuters) – The Trump administration has determined that top Chinese firms, including telecoms equipment giant Huawei Technologies and video surveillance company Hikvision, are owned or controlled by the Chinese military, laying the groundwork for new U.S. financial sanctions, according to a document seen by Reuters on Wednesday.

A U.S. defense official speaking on condition of anonymity confirmed the authenticity of the document and said it had been sent to Congress.

The list of 20 companies that Washington alleges are backed by the People’s Liberation Army also includes China Mobile Communications Group and China Telecommunications Corp as well as aircraft manufacturer Aviation Industry Corp of China.

The designations were drawn up by the Defense Department, which was mandated by a 1999 law to compile a list of firms "owned or controlled" by the People’s Liberation Army that provide commercial services, manufacture, produce or export.

The Pentagon’s designations do not trigger sanctions, but the law says the president may declare a national emergency which would allow him to penalize any companies on the list that operate in the United States.

Huawei, Hikvision, China Mobile, China Telecom, AVIC, the White House and the Chinese embassy in Washington did not immediately respond to requests for comment.

The Pentagon had come under pressure from lawmakers of both U.S. political parties to publish the list, amid rising tensions between Washington and Beijing over technology, trade and foreign policy.

Last September, top U.S. Senate Democrat Chuck Schumer and Republican Senator Tom Cotton penned a letter to Defense Secretary Mark Esper raising concerns about Beijing’s enlisting of Chinese corporations to harness emerging civilian technologies for military purposes.

"Will you commit to updating and publicly releasing this list as soon as possible?" they asked in the letter.

(Writing by Alexandra Alper; Additional reporting by David Shepardson; Editing by Jonathan Oatis and Howard Goller)