Court ruling suspends US ban on investment found in Xiaomi
13 March, 2021
A USA federal judge on Friday (Mar 12) temporarily blocked the Department of Security from forcing American investors to divest holdings in Chinese smartphone maker Xiaomi on the lands that the company has ties to China's military.
Six times before Donald Trump left office this past year, his administration cemented its trade war legacy against Beijing with some announcements targeting Chinese firms including Xiaomi, state essential oil giant CNOOC and social media darling TikTok.
Xiaomi was among nine businesses classified by the Pentagon while "Communist Chinese military firms", with the Defense Division adding them to a good list that will require Americans to market their interests found in the firms by a good deadline. The restrictions had been set to get into effect next week.
Xiaomi found in late January filed a good complaint in a good Washington court wanting to be taken off the list, calling its inclusion "unlawful and unconstitutional" and arguing that it had been not handled by the People's Liberation Army.
In the appeal, Xiaomi - which overtook Apple this past year to be the world's third-largest smartphone supplier - also said Washington's moves were "incorrect" and had "deprived the business of legal due course of action".
US District Judge Rudolph Contreras in Washington said on Friday that the court "concludes that defendants have not made the circumstance that the national security interests at stake here are compelling".
He issued a preliminary injunction removing Xiaomi from the blacklist and suspending the ban on US investors buying the company's securities.
Xiaomi and the Defense Department didn't immediately react to requests for comment.
Contreras's decision came on a single day that US regulators listed Huawei and ZTE among Chinese telecom gear firms deemed a threat to national reliability, signalling a hoped-for softening of relations isn't on the cards.
Huawei chief and founder Ren Zhengfei last month called for a good reset with the US in President Joe Biden, following the organization was battered by sanctions imposed by Trump's administration.
The telecoms giant has been at the centre of the Sino-American rivalry in recent years, against a backdrop of a trade and technology war between your superpowers.
Washington promises Huawei has close ties to China's military and that Beijing might use its products for espionage - accusations the business denies.
Source: www.channelnewsasia.com
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