RELEASE: C.P.D.C. Applauds Biden Administration’s Endorsement of Trump Capital Market Sanctions on the C.C.P.
For Immediate Release
June 3, 2020
Hamilton Strategies, [email protected],
Beth Harrison, 610.584.1096, ext. 105,
or Deborah Hamilton, ext. 102
C.P.D.C. Applauds Biden Administration’s Endorsement of Trump Capital Market Sanctions on the C.C.P.
Treasury Adds 59 Companies To Crippling OFAC List
WASHINGTON, D.C.— President JoeBiden amended President Donald Trump’s Executive Order 13959 “to further address the national emergency…with respect to the threat posed by the military-industrial complex of the People’s Republic of China.” The Committee on the Present Danger: China (CPDC) expressed satisfaction that the new administration has, in the words of a White House fact sheet issued today, “also expanded the scope of this national emergency by finding that the use of Chinese surveillance technology outside the PRC as well as the development or use of Chinese surveillance technology to facilitate repression or serious human rights abuses, constitute unusual and extraordinary threats.”
The CPDC also commends the Biden team for agreeing that the United States must be able “to prohibit – in a targeted and scoped matter – U.S. investments in Chinese companies that undermine the security or democratic valuesof the United States and our allies.”
From its inception in March of 2019, the Committee has insistently sought to deny access to U.S. stock and bond markets to companies that are owned or tied to the Chinese Communist Party (CCP) – including, but not limited to, those associated with the People’s Liberation Army and/or enabling human rights abuses. (For example, see here, here, here, and here). It was, accordingly, heartened by the two purposes of the amended Executive Order as described in today’s White House fact sheet:
“Solidify and strengthen a previous E.O. to prohibit U.S. investments in the military-industrial complex of the People’s Republic of China: This E.O. will amend E.O. 13959 by creating a sustainable and strengthened framework for imposing prohibitions on investments in Chinese defense and surveillance technology firms.”
“Ensure that U.S. investments are not supporting Chinese companies that undermine the security or values of the United States and our allies: This E.O. prevents U.S. investment from supporting the Chinese defense sector, while also expanding the U.S. Government’s ability to address the threat of Chinese surveillance technology firms that contribute – both inside and outside China – to the surveillance of religious or ethnic minorities or otherwise facilitate repression and serious human rights abuses.
The fact sheet went on to express the Biden administration’s intention in affirming and strengthening the underlying Trump Executive Order:
“It signals that the Administration will not hesitate to prevent U.S. capital from flowing into the PRC’s defense and related materiel sector, including companies that support the PRC’s military, intelligence, and other security research and development programs; or into Chinese companies that develop or use Chinese surveillance technology to facilitate repression or serious human rights abuse. Tackling these challenges head-on is consistent with the Biden Administration’s commitment to protecting core U.S. national security interests and democratic values, and the Administration will continue to update the list of PRC entities as appropriate.”(Emphasis added.)
In an annex to the Executive Order, the President made ineligible for inclusion in U.S. persons’ portfolios the stocks and bonds of fifty-nine Chinese companies in the PRC’s defense and related materials and surveillance sectors. These entities were placed on the new Non-Specially Designated Nationals (SDN) Chinese Military-Industrial Complex Companies List (NS-CMIC List) of the Treasury Department’s Office of Foreign Asset Control (OFAC).
While the Committee on the Present Danger: China welcomes the imposition of OFAC sanctions on these corporations, it intends to examine closely any corporate national security and human rights abusersthat appear on the Commerce Department’s Entity List and/or the Defense Department’s Section 1260H Chinese Military Companies List that have not been included in the OFAC list and the reasons for their exclusion.
The Committee will remain especially alert to the exclusion of publicly traded subsidiaries of OFAC-listed companies and conduct independent research to determine if any such exclusions are warranted. Finally, the behavior and actions of the Treasury Department,as administrator of the OFAC list, will be monitored carefully to avoid the glaring bias of the previousMnuchin Treasury Department which appeared more interested in protecting Wall Street fees and U.S.-China relations than our national security, fundamental values and scores of millions of American retail investors.
CPDC Chairman Brian T. Kennedy observed, “The Committee on the Present Danger: China congratulates the Biden administration for recognizing the urgent need to end the reckless practice of America’s capital markets underwriting our nation’s most dangerous enemy. We look forward to the faithful and full implementation of the amended Executive Order and will work to help ensure that outcome.”
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To interview representatives of the Committee on the Present Danger: China,
contact [email protected],
Beth Harrison, 610.584.1096, ext. 105,
or Deborah Hamilton, ext. 102.
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