By David Shepardson
WASHINGTON (Reuters) - The U.S. Commerce Department said on Monday it was putting 28 Chinese public security bureaus and companies - including video surveillance company Hikvision (SZ:002415) - on a U.S. trade blacklist over Beijing's treatment of Uighur Muslims and other predominantly Muslim ethnic minorities.
Those added to the so-called "Entity List" include the Xinjiang Uighur Autonomous Region People’s Government Public Security Bureau, 19 subordinate government agencies and eight commercial firms, according to a Commerce Department filing. The companies include Zhejiang Dahua Technology (SZ:002236), IFLYTEK Co (SZ:002230), Xiamen Meiya Pico Information Co (SZ:300188) and Yixin Science and Technology Co.
Reuters reported on the planned additions earlier Monday, before the Commerce Department made it official.
The department filing said the "entities have been implicated in human rights violations and abuses in the implementation of China’s campaign of repression, mass arbitrary detention, and high-technology surveillance against Uighurs, Kazakhs, and other members of Muslim minority groups."
U.S. officials said the announcement was not tied to this week's resumption of trade talks with China. Being added to the "Entity List" bars companies or other entities from buying parts and components from U.S. companies without U.S. government approval.
The Commerce Department previously added Huawei Technologies Co and more than 100 affiliates to the Entity List.
Hikvision, officially known as Hangzhou Hikvision Digital Technology Co Ltd, with a market value of about $42 billion, calls itself the world’s largest video surveillance gear maker. Reuters reported in August Hikvision receives nearly 30% of its 50 billion yuan ($7 billion) in revenue from overseas.
Hikvision did not immediately comment on the Commerce Department's move.
John Honovich, founder of surveillance video research company IPVM, said Hikvision and Dahua both use Intel (NASDAQ:INTC), Nvidia, Ambarella, Western Digital (NASDAQ:WDC) and Seagates as suppliers and that the impact on the Chinese companies would be “devastating." Shares in Ambarella fell more than 9% on the news.
In August, the Trump administration released an interim rule banning federal purchases of telecommunications equipment from five Chinese companies, including Huawei and Hikvision.
Huawei has repeatedly denied it is controlled by the Chinese government, military or intelligence services and has filed a lawsuit against the U.S. government's restrictions.