Huawei and Hikvision are ‘backed by Chinese military’, Trump administration says

US Defence Department document lays groundwork for new US financial sanctions on top Chinese firms

List of 20 companies allegedly backed by People’s Liberation Army also includes China Mobile, China Telecom and Aviation Industry Corp of China

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Published: 7:21am, 25 Jun 2020Updated: 10:05pm, 25 Jun 2020

The Trump administration has determined that top Chinese firms, including telecoms equipment giant Huawei Technologies and video surveillance company Hikvision, are owned or controlled by the Chinese military, laying the groundwork for new US financial sanctions, according to a document seen by Reuters on Wednesday.

A US defence official speaking on condition of anonymity confirmed the authenticity of the document and said it had been sent to Congress. Washington placed Huawei on a trade blacklist last year over national security concerns and has led an international campaign to convince allies to exclude it from their 5G networks.

The list of 20 companies that Washington alleges are backed by the People’s Liberation Army also includes China Mobile Communications Group and China Telecommunications Corp as well as aircraft manufacturer Aviation Industry Corp of China.

The designations were drawn up by the Defence Department, which was mandated by a 1999 law to compile a list of firms “owned or controlled” by the People’s Liberation Army that provide commercial services, manufacture, produce or export.

Surveillance cameras are seen near the headquarters of Chinese video surveillance firm Hikvision in Hangzhou in May 2019. Photo: Reuters

The Pentagon’s designations do not trigger penalties, but the law says the president may impose sanctions that could include blocking all property of the listed parties.