The Pentagon has added dozens of prominent Chinese companies, including Alibaba, electric-vehicle maker BYD, battery giant CATL, search company Baidu and telecom equipment maker Huawei, to its list of entities it says have ties to China's military. The update significantly expands a roster used to steer U.S. defense spending away from firms Washington views as linked to Beijing's armed forces.
The notice was filed on Monday and is scheduled for publication in the Federal Register on June 10, according to the listing. It lands just weeks before new restrictions take effect: starting June 30, the Defense Department will be barred from entering into, renewing or extending contracts directly with the listed companies or entities they control.
A broader, indirect prohibition follows in June 2027, when the rules will extend to goods or services that incorporate products from the designated firms, a provision with potentially far-reaching consequences for defense supply chains. The list, maintained under a statute commonly known by its section number, 1260H, does not itself impose sanctions but carries reputational weight and increasingly concrete contracting penalties.
Other newly named companies include chipmaker CXMT, robotics firm Unitree and others across China's technology and industrial sectors. The Pentagon alleges the firms have ownership ties to the State-owned Assets Supervision and Administration Commission, affiliations with the Ministry of Industry and Information Technology, connections to the People's Liberation Army, support from China's "Little Giant" industrial program, or a presence in designated military-civil fusion zones.
CATL, the world's largest battery maker, rejected its inclusion, calling the designation "a mistake" and saying it would proactively engage with the Pentagon to address what it called a "false designation." The company said it would take legal action if necessary to protect its interests and those of its stakeholders.
The expanded list comes amid persistent friction between Washington and Beijing over technology, trade and security. Several of the named companies have global operations and deep ties to international supply chains, and the designations could complicate their dealings with U.S. firms wary of the contracting restrictions.
Inclusion on the 1260H list has previously prompted affected companies to lobby for removal or to challenge the designation in U.S. courts, with mixed results. The Pentagon updates the list periodically and has steadily broadened it in recent years as part of a wider effort to limit Chinese access to U.S. defense and technology markets.
For the listed firms, the most immediate concern is the June 30 deadline, after which direct Defense Department business will be off limits, and the looming 2027 expansion that could ripple through any product containing their components.