Xiaomi Photo:VCG

A Xiaomi spokesperson told the Global Times on Saturday in a written statement that the company is "pleased" to see a US court enjoined from enforcing the designation of Xiaomi as a Chinese military company, adding that Xiaomi will continue requesting the court to permanently remove the designation.

"Xiaomi believes that the decision of designating it as a 'Chinese Communist Military Company' is arbitrary and capricious, and the judge agrees with it," the spokesperson said. "Xiaomi plans to continue to request that the court declare the designation unlawful and should be permanently removed."

In the statement, Xiaomi also reiterated that it is a "widely held, publicly traded, independently managed" company that offers products only for civilian and commercial use.

The Chinese smartphone manufacturer made the statement shortly after a federal judge blocked the US Defense Department from restricting US investment in the company by accusing Xiaomi of having ties to the Chinese military.

In mid-January, the Trump administration added Xiaomi and eight other firms to a list of the so-called "Communist Chinese military company" (CMCC). US investors are required to divest their holdings in the firms by a deadline of March 15. 

This is considered another extension of the Trump administration's crackdown on Chinese tech companies, following a slew of measures he took to strangle Chinese companies, such as placing a ban on popular Chinese apps like WeChat and TikTok. 

Xiaomi filed a complaint to a US court in late-January seeking to be removed from the list.

The court ruled that the US Department of Defense did not base its determination of Xiaomi as a CCMC on substantial evidence, concluding that Xiaomi is not effectively controlled or associated with others under the ownership or control of the Chinese government or its security services.

Rudolph Contrera, the court judge, put a temporary halt to the ban for Xiaomi.

Zhang Yi, an internet analyst and CEO of Guangzhou-based iiMedia Research, said that the ruling reflected that the US government's hegemony is determined on cracking down of Chinese companies to the extent of violating its own laws, and this is hurting the country's image. 

"But it also shows that when Chinese companies are facing unfair treatment from the US government, they can use the US laws as a weapon to safeguard their own interests, even though there is a cost," Zhang told the Global Times, adding that using the legal tools should be the "best way" for Chinese companies to fight US hegemony and unilateral ban. 

Global Times