Advertisement
Xiaomi pushes to clear name after court suspends US investment ban on the firm
- A US court ruled against a Department of Defence ban, which prohibits US investors from owning shares in Xiaomi because of alleged Chinese military ties
- Xiaomi sued the US departments of defence and treasury in January, seeking to undo the ban
Reading Time:2 minutes
Why you can trust SCMP
1
Xiaomi Corp, the world’s third-largest smartphone vendor, will step up efforts to clear its name after a US court suspended a Department of Defence (DOD) ban on American investments in the Chinese company.
Advertisement
The US District Court for the District of Columbia on Friday ruled against the DOD’s enforcement of the ban, which prohibits US investors from owning shares in Xiaomi because of its alleged ties with the Chinese military.
“Xiaomi believes that the decision of designating it as a ‘Chinese Communist Military Company’ is arbitrary and capricious, and the judge agrees with it,” a spokeswoman for Xiaomi said in a statement on Saturday. “Xiaomi plans to continue to request that the court declare the designation unlawful, and permanently remove the designation.”
The company sued the defence and treasury departments of the US in January, seeking to undo the former Trump administration’s ban under an executive order that restricts Americans from buying the firm’s securities and requires divestment of such holdings. The order was set to take effect next week.
In his ruling, US District Judge Rudolph Contreras in Washington said that the “defendants have not made the case that the national security interests at stake here are compelling”.
Advertisement
The stakes are high for Xiaomi, which is moving to fill the void left by Huawei Technologies Co in the global smartphone market amid the telecommunications equipment maker’s struggles with US sanctions.
Advertisement