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After Huawei, U.S. could blacklist Chinese surveillance tech firm: media

Published May 22, 2019 04:42AM ET
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© Reuters. FILE PHOTO: A Hikvision logo is seen at an exhibition during the World Intelligence Congress in Tianjin

By Brenda Goh

SHANGHAI (Reuters) - The U.S. administration is considering Huawei-like sanctions on Chinese video surveillance firm Hikvision, media reports show, deepening worries that trade friction between the world's top two economies could be further inflamed.

The restrictions would limit Hikvision's ability to buy U.S. technology and American companies may have to obtain government approval to supply components to the Chinese firm, the New York Times reported https://nyti.ms/2MfgBS3 on Tuesday.

The United States stuck Huawei Technologies on a trade blacklist last week, effectively banning U.S. firms from doing business with the world's largest telecom network gear maker, in a major escalation in the trade war.

The United States has accused Huawei of activities contrary to national security, a charge Huawei denies. However, this week the Trump administration granted the firm a license to buy U.S. goods until Aug. 19 to minimize disruption for customers.

Huawei says it can ensure a steady components supply chain without U.S. help. A Hikvision executive echoed the sentiment.

"Even if the U.S. stops selling them to us we can remedy this through other suppliers," a Hikvision executive said on condition of anonymity given the sensitivity of the matter.

"The chips Hikvision uses are very commercial and most of the suppliers are actually in China," she said, but added the company had not been informed of any possible U.S. blacklisting.

The White House did not respond to a request for comment.

Bloomberg, citing people familiar with the matter, reported the U.S. government was deliberating whether to add Hikvision, security equipment maker Zhejiang Dahua Technology and several other unidentified firms to a blacklist.

A Dahua investment department employee declined to comment.

Hikvision, with a market value of more than $37 billion, calls itself the world's largest video surveillance gear maker.

Its products are used in public places in China, from Beijing to Xinjiang. Headquartered in high-tech Hangzhou, one of China's richest cities, it sells close-circuit TV products, traffic and thermal cameras, and unmanned aerial vehicles.

China's foreign ministry on Wednesday urged the United States to provide a fair environment for Chinese firms, in the wake of reports Hikvision could be blacklisted.

"Recently we have repeatedly expressed China's position of opposing the United States' abuse of national power to wilfully smear and suppress other countries' companies, including Chinese companies," ministry spokesman Lu Kang said at a briefing.

China requires its companies to abide by international norms when investing abroad, but "at the same time we always demand that other countries give Chinese enterprises fair and non-discriminatory treatment", he added.

UIGHUR CONNECTION

Shares in Hikvision, 42% held by state-owned firms, opened 10% lower on Wednesday. It later pared some losses to trade down 6%. Dahua shares slumped as much as 9.2%.

Jefferies analyst Rex Wu downplayed the impact of a possible ban on Hikvision, saying the United States accounted for roughly 5% of the company's sales.

"Most AI solutions are sold to the government, public and enterprise sectors in China. Hikvision may be able to acquire GPU (graphics processing unit) via local distributors," Wu said.

Hikvision and Dahua were specifically cited in a letter to U.S. President Donald Trump's top advisers last month, signed by more than 40 lawmakers, which called for tighter U.S. export controls over China's treatment of Muslim minority.

China has faced growing global condemnation for setting up facilities in its western region of Xinjiang that U.N. experts describe as mass detention centers holding more than 1 million ethnic Uighurs and other Muslims.

Beijing has said its measures in Xinjiang, which reportedly also include widespread surveillance, are aimed at stemming the threat of Islamist militancy. The camps that have opened are vocational training centers, it has said.

In a separate email on Wednesday, a Hikvision spokeswoman said the firm took these concerns seriously and had since last October been engaging with the U.S. government on the subject.

After Huawei, U.S. could blacklist Chinese surveillance tech firm: media
 

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Comments (8)
lin gg
lin gg May 22, 2019 8:52AM ET
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good
LI SH
LI SH May 22, 2019 8:48AM ET
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Payback time!!
Xmr Lab
Xmr Lab May 22, 2019 7:23AM ET
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Only coward do like that. Well done..
Lynn McCord
the907man May 22, 2019 1:58AM ET
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China is so obsessed with control. They spend way too much time and energy trying to control as many people as possible. Their policies are extremely dangerous. Any country who distances themselves from China will much better off in the future. The world will decide who they trust more. China is forcing the world to choose a side. I don't think they will like the results.
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Lynn McCord
the907man May 22, 2019 1:58AM ET
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Double Fly  . China started this trade war more than 20 years ago. We are just recently responding. We encouraged the world to allow them into the WTO, and we opened up our market to them with the hope of helping them join in the rest of the world. It's mainly Russia and China who will never be content until America is ruined. They truly hate us, and will likely not rest until we have been defeated... whatever their definition of that is. I believe America must do everything necessary to protect ourselves and the rest of the free world. This is a very critical time in history.
Double Fly
Double Fly May 22, 2019 1:58AM ET
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Lynn McCord  I don't know where you got that hatred feeling from......It is true that the Chinese government spreads political propaganda against the U.S. since the Trade war. But before that, I, as a Chinese, I spent 8 years in the U.S. and I have been traveling around the world. What I can tell you is Chinese people are the most friendly to foreigners...I am not bragging or something. It is just what I saw and felt.
John Adams
AJBB May 22, 2019 1:58AM ET
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Do you have an idea on the total Chinese population? With limited resources, CCTVs and other forms of automation is pretty much the only way to monitor public safety.
LI SH
LI SH May 22, 2019 1:58AM ET
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China embarked on a war to rip off the Americans 20 years ago when it was invited into WTO without the intention to abide by the rules
LI SH
LI SH May 22, 2019 1:58AM ET
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Double fly, it’s not the Chinese people, it’s the CCP. what is your incentive to defend Chinese government if you know well that they don’t recognize private property ownership, any private enterprise entrepreneur who have succeeded in creating a successful company eventually will eventually cede their control and wealth to the Chinese government CCP ( eg Alibaba Jack Ma) CCP just uses you to create the wealth for the communist party and for the government officials. After you pay million for your home, you don’t even have the ownership of your home , only the right to live there for 70 years. And yet you’re still defending this mafia government, unless of course you’ve been paid to do so.
Jack AAA
Jack_A May 22, 2019 12:02AM ET
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Ban, ban, ban, so who cares! Only us customers suffer. Get out the office now!!
LI SH
LI SH May 22, 2019 12:02AM ET
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Why don’t you get out of America Jack, you’re out of China because America’s generosity and open arm, you sure do not know what happened during the Great Leap and Cultural Revolution, worry about your relatives in China because Xi is trying to repeat history
Kyro Ren
Kyro Ren May 21, 2019 11:35PM ET
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what is the goal of the trump administration? to get a trade deal with China favouring the US? Why are you using national emergency to fire on Chinese companies? Suspected vioaliton on human rights in China is a national security issue to the US? What is the logic? this administration is damaging image of a country that was once respected by Chinese businesses.
LI SH
LI SH May 21, 2019 11:35PM ET
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Because China CCP is predatory at core, their real intention is to achieve global hegemony
David David
David9 May 21, 2019 9:32PM ET
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Time for impeachment soon. This is getting out of hands. US is a shame on the world stage. No other country is doing this.
Carlos Pacheco
Carlos Pacheco May 21, 2019 9:32PM ET
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I am no trump fan. But you should read more. There are other countries that do this... example germany will not export defense products to saudia arabia
Jeff Chevalier
Jeff Chevalier May 21, 2019 9:32PM ET
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only because Saudi Arabia is a US client.
Albert Vives
Albert Vives May 21, 2019 9:32PM ET
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maybe because they use that weapons to ******civilians in Yemen...
Thomas DeVito
Thomas DeVito May 21, 2019 9:27PM ET
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please do
 
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