WASHINGTON — The Pentagon has added several prominent Chinese businesses, including the e-commerce company Alibaba, search engine Baidu and electric-vehicle maker BYD, to its list of firms it considers linked to China's military, a designation that bars them from U.S. defense contracts.
The Defense Department published the updated roster, known as the Section 1260H list, on Monday. The list, created in 2021 under a congressional mandate, identifies companies the Pentagon views as tied to China's military or as contributing to the country's defense industrial base, including firms not traditionally seen as part of the defense or security sector.
This year's list has grown to 188 Chinese entities, up from roughly 130 a year earlier, according to The Associated Press. Other additions reported this year include the EV maker Nio, the robotics company Unitree, battery firms and makers of lidar sensors used in autonomous vehicles, according to TechCrunch. The update also restored two Chinese memory chipmakers, ChangXin Memory Technologies and Yangtze Memory Technologies, that had been dropped from an earlier draft, according to Bloomberg via Fortune.
Monday's release appears to finalize a version of the list that was briefly posted to the Federal Register in February before being withdrawn without explanation, according to TechCrunch and Bloomberg. The U.S. House Select Committee on China publicized the additions, with Chairman John Moolenaar describing the updated list as a warning to American businesses and government agencies.
In naming Alibaba, the Pentagon said the company supports China's defense industrial base through an affiliation with the country's Ministry of Industry and Information Technology, which oversees technology and industrial policy. It cited the same ministry in listing BYD and Baidu, according to the AP. Alibaba is traded on the New York Stock Exchange, and BYD is among the largest electric-vehicle makers globally.
The designations do not impose sanctions on their own. The Defense Department will be prohibited from contracting directly with listed companies later this month and from procuring their products or services through third parties beginning in June 2027, according to CNBC.
Several of the companies rejected the move. Alibaba said it is not a Chinese military company and not part of any military-civil fusion strategy, and told CNBC it would take all available legal action against attempts to misrepresent it. Baidu called the suggestion that it is a military company baseless and said it would use all available options to be removed from the list, according to statements cited by NPR and TechCrunch. Several firms, including Nio and BYD, did not immediately respond to requests for comment, according to TechCrunch.
China's Foreign Ministry said Tuesday it would take necessary measures to protect the legitimate rights of Chinese companies, according to CNBC. The update came weeks after President Donald Trump met Chinese leader Xi Jinping in Beijing, where the two announced a trade truce, the outlet reported. Shares of the listed firms moved modestly, with Baidu's U.S.-listed shares down about 2%.
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