GUANGZHOU, China – The Trump administration has added smartphone maker Xiaomi to the Chinese military company’s blacklist.
The Chinese company’s Hong Kong-listed shares were down 10.6 percent when it opened on Friday, on the news.
Beijing-based Xiaomi was the world̵7;s third-largest smartphone maker in the third quarter of 2020.
The move means Xiaomi was under an executive order in November that restricts American investors from buying shares or related securities of any company designated by the Pentagon as a Chinese military company.
The first Trump administration order was later extended to force investors to withdraw or sell out of affected holdings by Nov. 11 this year.
Xiaomi was not immediately available for comment when contacted by CNBC.
The company is registered in Hong Kong and not in the United States.
“The Department is committed to emphasizing and responding to the People’s Republic of China (PRC) military development and civil integration strategy, which supports the People’s Liberation Army’s (PLA) modernization goals, ensuring access to technology and freedom. Advanced expertise acquired and developed by even PRC companies, universities and research projects that appear to be civilian entities, “the DOD said in a statement.
Xiaomi is one of nine entities designated as a “Communist Chinese Military Company”. Chinese aircraft maker Comac is also on the list.
DOD released a list of startups in June 2020.Companies such as Chinese tech giant Huawei and semiconductor maker SMIC are also on the list.