The U.S. Department of Justice today announced that it has placed Xiaomi and several other Chinese firms on its so-called entity list, preventing it from doing business with companies based in the United States. Oddly, Xiaomi is described by the U.S. government as a military corporation.
“Today, the Department of Defense released the names of additional “Communist Chinese military companies” operating directly or indirectly in the United States in accordance with the statutory requirement of Section 1237 of the National Defense Authorization Act for Fiscal Year 1999, as amended,” the DOJ announced. “The Department is determined to highlight and counter the People’s Republic of China’s (PRC) Military-Civil Fusion development strategy, which supports the modernization goals of the People’s Liberation Army (PLA) by ensuring its access to advanced technologies and expertise acquired and developed by even those PRC companies, universities, and research programs that appear to be civilian entities.”
The unexpected move comes just days before the controversy-plagued Trump administration is finally removed from office and seems to mirror the action against Huawei in that it comes after Xiaomi surpassed Apple to become the world’s third-largest seller of smartphones. But there are differences, too. Xiaomi doesn’t make networking equipment, just consumer smart devices. And the military angle is unique: With Huawei, the U.S. claims that the firm might act on behalf of the Chinese government.
Xiaomi says it has no ties to the Chinese military.
“[Xiaomi] has been in compliance with law and operating in compliance with the relevant laws and regulations of jurisdictions where it conducts its businesses,” a Xiaomi statement reads. “The Company reiterates that it provides products and services for civilian and commercial use. The Company confirms that it is not owned, controlled[,] or affiliated with the Chinese military, and is not a ‘Communist Chinese Military Company’ defined under the NDAA. The Company will take appropriate course of actions to protect the interests of the Company and its shareholders.”
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