In a new FAQ, OFAC clarified that the prohibitions in Executive Order 13959 ("Addressing the Threat from Securities Investments That Finance Communist Chinese Military Companies") do not apply to Xiaomi Corporation.
OFAC explained that the FAQ follows from a U.S. District Court for the District of Columbia Order vacating the listing of Xiaomi Corporation as a Communist Chinese military company. The Court had previously granted Xiaomi's Motion for a Preliminary Injunction enjoining enforcement of prohibitions under Executive Order 13959. Under the Final Order, which was proposed jointly by Xiaomi and the U.S. Department of Defense ("DoD") and signed by the Court, the January 2021 listing of Xiaomi on DoD's list of Communist Chinese Military Companies was found to be "inconsistent with the Administrative Procedures Act."
OFAC issued two FAQs addressing the application of sanctions on certain Chinese military companies.
OFAC permitted transactions by U.S.-operated securities exchanges involving the purchase or sale of securities related to newly listed entities on OFAC's Non-Specially Designated Nationals Communist Chinese Military Companies List.
In a new Executive Order, President Trump amended and expanded certain prohibitions to address the threat from securities investments that finance Communist Chinese military companies.
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