Yesterday we reported that the US federal government had placed Chinese video game publisher Tencent – owner of League Of Legends developers Riot Games, Path Of Exile developers Grinding Gear and many more – on a list of Chinese military companies. The list in question is part of a strategy to counter what the US sees as the close relationship between the Chinese military and various suppliers of civilian technology and research projects.
Upon publication yesterday, a Tencent spokesperson had noted that the listing was based on a “misunderstanding”. In a statement sent to RPS last night and also published online, Tencent Chairman Ma Huateng and the board of directors have now said they are prepared to take legal action if the misunderstanding is not resolved.
The statement in full is quite robotic and mainly fleshes out the spokesperson’s earlier argument that Tencent is not in fact involved in anything military. It further states that Tencent is not a “military-civilian merger,” in response to statements from the US Department of Defense. standing claim that China’s armed forces are dependent on “technology and expertise” provided by Chinese “companies, universities and research programs” that “appear to be civilian entities.”
“As the company is neither a Chinese military company nor a military-civilian merger contributing to China’s defense industrial base, it is believed that its inclusion in the [Chinese Military Company] The list is a mistake,” the statement read. “Unlike other lists maintained by the US government for sanctions or export control measures, inclusion on the CMC list only covers US defense procurement, which does not affect the activities of the Group.”
The statement also specifies that the ‘CMC list’ – which was introduced under Trump’s first presidency and is known within the US government as the Section 1260H list – is different from another document, the Non-SDN Chinese Military-Industrial Complex List. managed by the US Office of Foreign Assets Control. The point is that “inclusion on the CMC list will not prohibit any person (other than the Department of Defense) from conducting business transactions with the company, including trading in the company’s securities.”
Tencent is about to “initiate a review process to correct this error,” in which they will “engage in discussions with the U.S. Department of Defense to resolve any misunderstandings, and if necessary, take legal action to remove the company from the CMC list to delete. .”
If it goes to trial, Tencent won’t be the first Chinese company to go to court over their inclusion on the US federal government’s list of ‘military-civilian mergers’. As reported by ReutersDrone maker DJI and Lidar maker Hesai Technologies sued the Pentagon last year over their designations, although they are currently still on the list.