The new executive order is another instance the Biden administration is building on from the Trump-era China initiative. Mr. Biden has also kept tariffs on Chinese goods unchanged, as leverage in the negotiations. In this case, Biden administration officials say they acted in part to correct the executive order issued by President Donald J. Trump last November, which was successfully challenged, in the courts. US court because it did not provide a clear factual basis for the investment ban. in Chinese companies with links to the defense industry.
The list of Chinese companies affected by the new order was compiled by the Treasury Department, which has deep experience in issuing sanctions, rather than the Pentagon. It was in part an effort to clarify the reasons for each company’s designation, officials said, in the hope that the ban would be upheld in court.
Administration officials say the number of Chinese companies targeted by the ban is likely to increase.
The order targets some of the giants of China’s telecommunications industry, some of which still operate within the United States or cooperate with American companies. It’s a signal that scrutiny of China’s influence over the global tech space has not abated in Washington despite the Democrats’ shift to control in the White House.
Among the companies Biden listed on Thursday was Huawei, China’s national champion in telecommunications and at the heart of efforts to export 5G networks around the world. For years, the Trump administration has tried to get rid of the company, banning the sale of most of its technology within the United States, urging allies to reject them and trying to starve the chip companies in need. For some time, Mike Pompeo, the former secretary of state, and other US officials have threatened to ban allies from sharing in US intelligence briefings if they use Huawei in their networks. That backfires, but allies are increasingly limiting Huawei’s role. However, Huawei is not publicly held, so the order would essentially bar Americans from helping bail out their debts.
Huawei had no comment on Thursday’s ban.
The order also lists three carriers – China Unicom, China Telecom and China Mobile – increasingly in the sights of US lawmakers and regulators. In 2019, lawmakers urged the Federal Communications Commission to review China Unicom and China Telecom’s licenses to operate in the United States. The agency moved in March to consider restricting China Unicom’s operations. All are under surveillance to see if they are redirecting phone or internet traffic back to China for the benefit of Chinese intelligence services.
China Telecom declined to comment on the new order.
In 2019, the Federal Communications Commission also blocked China Mobile’s app to support calls between the United States and other countries, on the grounds that the Chinese government could use its control over the phone. with the company to track calls from Americans.
But matters are complicated by the companies’ relationships with American companies. China Mobile has supported iPhones in China since 2014, a deal important to Apple’s growth in the Chinese market. “Apple has great respect for China Mobile and we are excited to begin working together,” Apple CEO Tim Cook said in a press release. At that time, China Mobile was the largest mobile network in the world with 763 million customers.