We have updated our dataset of Chinese military companies identified under Section 1237 of the National Defense Authorization Act to reflect the U.S. Department of Defense’s addition of nine entities on January 14. The updated dataset also includes 34 entities we determined to be majority-owned by the companies identified in Tranche 5. We have determined that these additional entities do not have obvious ties to China’s military.
Tranche 5 also includes CNAH and Xiaomi
In a departure from previous additions to the Section 1237 list, Tranche 5 includes a state-owned venture capital fund, the Beijing Zhongguancun Development Investment Center. The fund is located in a part of Beijing popularly known as “China’s Silicon Valley”. In 2018, the U.S. Trade Representative identified Zhongguancun as a national security threat. Zhongguancun owns subsidiaries in Boston and California and maintains a partnership with Stanford University.
Tranche 5 also includes China National Aviation Holding (CNAH), which is the parent company of Air China, and Xiaomi, a major smartphone manufacturer.
About the Section 1237 Dataset
The expansion of the Tranche 5 dataset was carried out consistently with those of both our initial dataset and the subsequent Tranche 4 update. We queried Sayari’s public records database using the nine companies identified by the Department of Defense to identify 883 downstream entities within three layers of ownership. These holdings include majority and minority-owned entities, subsidiaries, and company branches. We subsequently narrowed our query to exclusively include subsidiaries or entities majority owned by the nine entities in question, resulting in 34 entities. Our expanded dataset currently includes these 34 entities along with their identifying information and other relevant attributes based on available public records last collected in October 2020.
Please note that due to the limitations iterated in our previous publication, there may be other entities that meet the majority ownership risk threshold which we were unable to identify and thus were omitted from this dataset. Likewise, there may be conflicts between a company’s primary registration record and information disclosed in other official sources such as its annual report.