Shares of Chinese tech heavyweight Tencent Holdings tumbled more than 7% to hit a low of HK$380.6 at one point in Hong Kong after the US added the company to a list of “Chinese military companies.”
The move follows a near 8% fall in Tencent’s US depository receipts overnight in the US market.
The US Defense Department said on Monday it has added Chinese tech giants including gaming and social media leader Tencent and battery maker CATL to a list of firms it says work with China’s military.
The list also included chip maker Changxin Memory Technologies, Quectel Wireless and drone maker Autel Robotics\, according to a document released by the department.
Other Chinese companies added to the list included battery maker CATL, which is part of the supply chain for automakers such as Ford and Tesla. CATL shares, which fell as much as 5.6%, were last down 3.5% in Shenzhen.
The National Defence Authorization Act of 2024 says that the DoD will be prohibited from procuring goods or services directly from entities on the list in June 2026, and indirectly from June 2027.
In response to the decision, Tencent said in a statement that its inclusion in the list is clearly a mistake.
“We are not a military company or supplier. Unlike sanctions or export controls, this listing has no impact on our business,” it added. “We will work with the relevant US authorities to resolve the misunderstanding.”
CATL also called the designation “a mistake” in a response, saying it “is not engaged in any military related activities.”
SenseTime expressed strong opposition to the US decision to include it in the list, saying the move is baseless.
SenseTime noted that the move has no substantial influence on the company’s business and meanwhile, it will actively communicate with all parties as soon as possible to ensure fair treatment and to protect the interests of the company and its shareholders.
