U.S. Adds Tencent and CATL to Section 1260H List, Shares Drop Amid No Immediate Sanctions

Jan 7, 2025, 01:34 AM

The U.S. Department of Defense has added Chinese tech giant Tencent Holdings and battery maker Contemporary Amperex Technology Co. Limited (CATL) to the Section 1260H list, which now includes 134 firms it alleges are working with China's military. Tencent and CATL have both refuted their inclusion, with Tencent stating that it is 'clearly a mistake' and that it is 'not a military company or supplier.' CATL similarly denied any involvement in military activities. The addition to the list has led to a significant drop in the share prices of both companies, with Tencent's shares falling over 7% in Hong Kong and CATL's shares dropping over 5% in Shenzhen. The list serves as a warning to U.S. companies about the risks of engaging with these firms, though it does not immediately impose sanctions. The Chinese embassy in Washington criticized the move as 'unreasonable suppression of Chinese companies.'