WASHINGTON — The Coalition for a Prosperous America (CPA) today welcomed the action by the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) to add China’s artificial intelligence company SenseTime to OFAC’s Non-SDN Chinese Military-Industrial Complex Companies List (NS-CMIC List) due to the company’s connection to the Chinese Communist Party’s human rights abuses and support of China’s People’s Liberation Army. In 2019, the Trump administration added SenseTime to the Commerce Department’s Entity List due to its complicity in the CCP’s egregious human rights abuses against Uyghurs and other religious ethnic minorities in Xinjiang.
This NS-CMIC identification prohibits the purchase or sale by U.S. persons of any publicly traded securities, or any publicly traded securities that are derivative of such securities or are designed to provide investment exposure to such securities, of SenseTime pursuant to E.O. 13959, as amended. In June, CPA supported President Biden’s E.O. 14032, which updated E.O. 13959 and established the NS-CMIC list and widened capital markets sanctions to include Chinese defense and related materiel sector companies, as well as Chinese companies that develop or use Chinese surveillance technology to facilitate repression or serious human rights abuses.
“Companies that are helping the CCP advance its efforts to undermine U.S. national and economic security, as well as that are complicit in China’s genocide and human rights abuses in Xinjiang, should not have access to U.S. capital markets,” said Zach Mottl, Chairman of CPA. “The Biden administration is absolutely right to place SenseTime on the OFAC NS-CMIC list and prohibit this artificial intelligence arm of the CCP from exploiting unwitting American investors and our capital markets.”
SenseTime, which was planning an initial public offering (IPO) in Hong Kong, announced it would postpone after it was added to OFAC’s NS-CMIC List. The company hoped to raise as much as $767 million in the IPO.
“SenseTime is directly complicit in the CCP’s Orwellian surveillance state and buildup of modern day concentration camps in Xinjiang,” said Michael Stumo, CEO of CPA. “SenseTime should never be able to access U.S. capital markets to fund these evil activities, and the Biden administration’s actions to prevent that are exactly the kind of capital markets sanctions we need across the board on Chinese companies. Going forward, the Biden administration should aggressively use capital markets sanctions on CCP companies, and their subsidiaries, that currently have access to U.S. capital markets and are able to raise funds from unwitting American investors.”
In October, CPA, along with human rights groups, urged Secretary of the Treasury Janet Yellen to protect American retail investors and U.S. national security by implementing capital markets sanctions against Chinese companies pursuant to E.O. 14032. Since President Biden signed E.O. 14032, the Treasury Department has only added one Chinese company—SenseTime—to the NS-CMIC List. Out of the 452 Chinese companies on the Department of Commerce’s Entity List, only five—less than 1 percent—appear on the NS-CMIC List.