The Pentagon briefly added several major Chinese tech companies, including Alibaba Group Holding, Baidu Inc., BYD Co., and TP-Link Technologies Co., to a list of firms accused of supporting China’s military. The list was withdrawn just minutes after being posted publicly, creating confusion and causing temporary volatility in the affected companies’ stock prices.
The sudden reversal occurred on Friday, leaving analysts to speculate about the administration’s intentions. Some suggested that if the list were to be reposted, it could be seen as a show of strength ahead of an anticipated meeting between the leaders of the two nations. Shortly after the initial publication, the official government journal declared the list “unpublished.” When asked for comment, the Pentagon stated it had “nothing to announce at this time.”
While this type of designation carries few immediate legal penalties, it is increasingly used by the Pentagon to restrict a company’s ability to contract with the U.S. military or receive research funding. It also serves as a significant warning to American investors and is often a precursor to more severe trade restrictions.
The financial markets reacted quickly. U.S.-traded shares of Alibaba and Baidu fell following the news before recovering some of their losses later in the day. A foreign policy analyst noted that releasing the list before a high-level summit could be a strategic move to maintain pressure on national security issues while keeping trade talks separate.
According to a copy of a letter provided to the press, the Defense Department formally requested the withdrawal of the 20-page document. The letter stated the notice was filed for public inspection and was scheduled for official publication the following Tuesday, but the department asked for it to be removed and withdrawn from publication entirely.
The companies involved strongly denied the allegations. Alibaba stated it is not a military company and is not part of any military-civil fusion strategy, adding that it would “take all available legal action against attempts to misrepresent our company.” Similarly, Baidu categorically rejected its inclusion, calling the suggestion “entirely baseless” and vowing to use all options to have its name removed from the list.
If the notice is not republished, it could signal an effort to avoid escalating tensions with Beijing ahead of the planned visit. Another interpretation is that it adds to a perception that the U.S. is softening its stance in the technological rivalry with China. Alibaba and Baidu are leaders in artificial intelligence, and their inclusion on such a list would almost certainly provoke a strong reaction from the Chinese government, which has previously urged the U.S. to “correct its erroneous actions.”
The brief listing of BYD, China’s leading electric vehicle manufacturer, also highlighted the broad scope of the Pentagon’s scrutiny. An additional point of confusion was the inclusion of TP-Link’s China unit, rather than its U.S. subsidiary, which has previously been examined for potential national security risks.