U.S. President Joe Biden’s position on Trump’s order has been closely monitored by Wall Street and Capitol Hill, where lawmakers on both sides have called for a firm stance against China on issues ranging from from trade to human rights.
President Joe Biden on Thursday signed an order amending the U.S. investment ban on Chinese companies initiated under his predecessor, which named 59 companies linked to the Chinese military or surveillance industry, including Huawei Technologies Co.
The ban on new investments will take effect Aug. 2 at 12:01 p.m. in New York, according to administration officials who informed reporters on condition of anonymity. Investors will have a year to disintegrate completely.
Biden’s order is largely a continuation of a policy issued by former President Donald Trump that was challenged in court and confused investors with the scope of its reach to subsidiaries of blocked companies. Biden’s position on Trump’s order has been closely monitored by Wall Street and Capitol Hill, where lawmakers on both sides have called for a firm stance against China on issues ranging from trade to human rights.
Many of the companies under Biden’s order were already on the Trump administration’s list, including the country’s largest telecommunications company: China Mobile Communications Group Co., China Unicom Ltd. and China Telecommunications Corp.
Biden’s list of defense companies include Aviation Industry Corp. of China, Ltd., which is one of the best known of the Chinese military giants; China North Industries Group Corp .; China Aerospace Science and Industry Corporation Ltd; and China Shipbuilding Industry Co.
Biden’s list also includes Hangzhou Hikvision Digital Technology Co., the developer of surveillance cameras and facial recognition technology that has helped Chinese authorities develop “safe city” initiatives in Xinjiang, where ethnic Uighurs have been persecuted.
Among the companies on Biden’s list that were not covered in Trump’s initial ban are Zhonghang Electronic Measuring Instruments Co. and Jiangxi Hongdu Aviation Industry Co.
Others include: Proven Honor Capital Ltd .; Proved Glory Capital Ltd .; Shaanxi Zhongtian Rocket Technology Co .; Inner Mongolia First Machinery Group Co .; Changsha Jingjia Microelectronics Co .; China Avionics Systems Company Ltd; China Satellite Communications Co .; Costar Group Co., based in China; Fujian Torch Electron Technology Co .; and Guizhou Space Appliance Co.
The Treasury Department on Thursday released guidelines on sanctions. Treasury will update the list continuously, said one of the officials.
Under Biden’s order, investment bans will apply to subsidiaries of companies only if they are listed by the Office of Foreign Assets Control. The amended order clarifies that the measures will no longer apply to companies whose names match the listed entities, Biden administration officials said.
The OFAC list will be coordinated with the State and Defense departments. The Pentagon, which Congress requires to maintain a list of companies linked to the Chinese military, is expected to release additional trade names on Thursday. Some companies will be listed by the Pentagon and OFAC, officials said.
The change in Trump’s order comes after two Chinese companies successfully challenged it in U.S. court. The Biden team said a review was needed to ensure it was legally sound and sustainable in the long run.