Investors are showing positive sentiment based on the court ruling as Xiaomi shares are trading at HKD 24.35, up more than 7% at the time of writing.
The shares of Hong Kong-listed tech giant Xiaomi Corp (HKG: 1810) are up 7.03%, following the lifting of earlier restrictions imposed on the company by the Donald Trump Administration. According to the official statement issued by the firm, the United States District Court for the District of Columbia granted a preliminary injunction against the Trump-era imposed order.
According to an earlier report by Coinspeaker, Xiaomi was blacklisted by the Trump administration back in January, alleging that the firm is a Communist Chinese Military Company (CCMC), following an earlier Executive Order signed by the ex-president in a move to clamp down on some Chinese tech firms.
“The Department is determined to highlight and counter the People’s Republic of China’s (PRC) Military-Civil Fusion development strategy, which supports the modernization goals of the People’s Liberation Army (PLA) by ensuring its access to advanced technologies and expertise acquired and developed by even those PRC companies, universities, and research programs that appear to be civilian entities,” the DOD said in a statement at the time.
Based on the terms of the blacklist, US investors were restricted from purchasing the shares of the company or any related securities the firm may offer. Xiaomi on its part has constantly refuted this allegation, reiterating that “it is not owned, controlled, or affiliated with the Chinese military, and is not a ‘Communist Chinese Military Company’ defined under the NDAA.”
At last, the court presided over by Judge Rudolph Contreras has liberated the firm with conviction there is “plainly a lack of substantial evidence to adequately support a finding which suggests Xiaomi is a CCMC,” as reported by CNBC. The judge also granted the preliminary injunction stating that failure to do so will make the company “suffer irreparable harm in the form of serious reputational and unrecoverable economic injuries.”
Investors are showing positive sentiment based on the court ruling as Xiaomi shares are trading at HKD 24.35, up more than 7% at the time of writing.
Xiaomi to Seek Permanent Removal of Trump Designation
While the preliminary injunction has been welcomed by the company as a positive ruling, it is bent on getting the Court to completely remove the CCMC affiliation designation pronounced on it by the Trump administration.
The company in the issued statement noted it “believes that the decisions of designating it as a Communist Chinese Military Company are arbitrary and capricious, and the judge agrees with it,” adding it will “continue to request that the court declare the designation unlawful and to permanently remove the designation.”
Xiaomi is one of many companies including Huawei Technologies Co Ltd that were banned by the past administration. Huawei’s business has been particularly impacted by the strained relationship with the US government as the purchase of chips from its US allies was blocked, and its phone production capabilities reduced. Just like Xiaomi, Huawei as well as other Chinese outfits are looking forward to better days in this Biden era.
next