BRIEF: Tencent, CATL added to U.S. Defense Department blacklist

Internet giant Tencent (0700.HK) and leading electric vehicle (EV) battery maker CATL (300750.SZ) were among 134 Chinese companies whose names appeared on an updated version of a blacklist published Monday by the U.S. Department of Defense. Companies that appear on the list are alleged to have ties to the Chinese military, though the U.S. Defense Department does not typically provide details on those ties.

Others on the latest edition of the list included memory chip maker Changxin Memory Technologies, drone maker Autel Robotics (688208.SH), and state-owned giants like shipping company Cosco (601919.SH) and energy major CNOOC (0883.HK; 600968.SH), according to a Reuters report.

Landing on the blacklist has no immediate impact on a company in terms of sanctions or other punitive measures. But companies that receive such designation may find themselves shunned by other firms worried that contact could harm their reputations and relations with the U.S. government.

Tencent said that its inclusion on the list was “clearly a mistake,” adding the designation would have no impact on its business. CATL said it was not engaged in any military activities. Tencent shares were down 7.4% in Tuesday afternoon trade in Hong Kong, while CATL’s Shenzhen-listed shares were down 2.5%,

By Doug Young

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