US Cuts China Chip Firm From 'Military Ties' List After Lawsuit

The US Defense Department on Tuesday removed one of China’s leading chip equipment makers from a list of Chinese companies the Pentagon said were allegedly working with Beijing’s military.

The company — Advanced Micro-Fabrication Equipment (AMEC) — had filed a federal lawsuit in August against the US Defense Department over its inclusion in Washington’s “Entities Identified as Chinese Military Companies Operating in the United States” list in February.

AMEC’s shares jumped 4.35% after its removal from the list.

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While being placed on the list doesn’t involve immediate bans, it can be a blow to designated companies’ reputations and represents a warning to US entities and companies about the risks of conducting business with them.

The company, which sought a court order to remove the designation, said it has never been involved in military activities and strictly complies with all laws and regulations.

The US Defense Department also removed IDG Capital, one of China’s largest venture capital and private equity firms from the list, which was scheduled for publication on Wednesday.

IDG Capital, which was also added to the list in February, did not sue but has previously said it has no association with the Chinese military and does not belong on that list.

The list includes entities that have been targeted by US trade sanctions in recent years, including Huawei Technologies and state-owned aerospace and defence manufacturing conglomerate Aviation Industry Corporation of China (AVIC).

Reuters, with additional editing by Vishakha Saxena

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Vishakha Saxena

Vishakha Saxena is the Multimedia and Social Media Editor at Asia Financial. She has worked as a digital journalist since 2013, and is an experienced writer and multimedia producer. As a trader and investor, she is keenly interested in new economy, emerging markets and the intersections of finance and society. You can write to her at [email protected]