Trump Issues EO to Ban US Investments in Chinese Military Companies

President Donald Trump issued an executive order Nov. 12 that will block Americans from transacting in “publicly traded securities” or investing in Chinese firms that have ties to the Chinese military when it takes effect Jan. 11, 2021. The EO bans investments in a range of Chinese companies included in lists published by the Defense Department earlier this year, including Huawei, Hikvision and other prominent Chinese technology companies (see 2008300001 and 2006250024). U.S. people or companies violating the order could be subject to restrictions or sanctions under the International Emergency Economic Powers Act, said the EO, which will be imposed by the Treasury Department after consultation with other agencies. The White House said agencies may soon issue “rules and regulations” to implement the order, including procedures for license applications.

A Chinese Foreign Ministry spokesperson criticized the order and urged the U.S. to reverse its decision. “This seriously violates the principle of market competition and international economic and trade rules,” the spokesperson said Nov. 13, according to a transcript of a regular press conference. “We will resolutely safeguard the legitimate and lawful rights and interests of Chinese enterprises.”