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Court Filings Show Defense Department Removes Xiaomi From Blacklist

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Court Filings Show Defense Department Removes Xiaomi From Blacklist
  • The U.S Department of Defense has agreed to remove the Chinese smartphone company Xiaomi Corp’s (OTC: XIACF) blacklisting, bringing an end to their ongoing tussle, Reuters reports.
  • The Court filing stated that both parties would resolve litigation without a further contest.
  • The parties were negotiating over specific terms and will file a separate joint proposal before May 20, Bloomberg reports.
  • The former Donald Trump administration had banned Xiaomi earlier this year over alleged military ties along with seven other Chinese companies, including a restriction on U.S. investments in the company.
  • Trump’s November order prohibited American investment in Chinese firms owned or controlled by the military.
  • Xiaomi retaliated with a lawsuit denying its Chinese military connections and won the court ruling over the investment restrictions.
  • The blacklisting enforcement was temporarily blocked in March by a federal judge under the President Joe Biden administration, considering the ban as “deeply flawed.”
  • Reuters notes that other Chinese firms were also contemplating similar lawsuits after Xiaomi’s victory.
  • Trump’s order also targeted TikTok owner ByteDance Ltd and WeChat owner Tencent Holdings Ltd (OTC: TCEHY). Huawei Technologies Co was prohibited from buying American-made components and banned from global infrastructure projects.
  • Interestingly, Biden also extended a 2019 executive order this week, excluding the U.S. companies from using telecommunications equipment manufactured by firms like Huawei over national security risk concerns.
  • Congress also remains focused on bipartisan legislation to oppose China and bolster the U.S. position in technology and critical manufacturing.
  • Price action: XIACF shares closed lower by 1.9% at $3.1 on Tuesday.
 

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