Before the new U.S. regulations took effect on Tuesday, several heavyweight lobbying firms in Washington are accelerating their efforts to sever ties with Chinese tech companies such as Alibaba and Tencent, in order to avoid losing business with the U.S. Department of Defense by simultaneously representing clients listed on the Pentagon’s “Chinese military-industrial complex” blacklist. According to recently disclosed documents, Alibaba has lost five lobbying firms, while Tencent has lost four, including Brownstein Hyatt Farber Schreck, Mercury Public Affairs, and MO Strategies. The new rule prohibits the Department of Defense from partnering with companies represented by lobbying firms that also represent entities on the Pentagon’s blacklist—effectively forcing lobbying agencies to choose between Chinese clients and U.S. defense contractors. Alibaba has already filed a lawsuit against the Pentagon, seeking removal from the 1260H list, arguing that these restrictions have prompted multiple lobbying firms to terminate their relationships. Both Tencent and Alibaba previously denied any collaboration with China's military.
This shift underscores how rapidly the Pentagon’s blacklist is expanding its influence in the broader U.S.-China technological and security competition. In recent years, the list has grown from around 20 companies to 188, covering critical sectors such as semiconductors, artificial intelligence, robotics, drones, surveillance, and optical communications—including companies like DJI, Hikvision, Zijin Optoelectronics, and Unitree Robotics. Washington is increasingly using this list as a foundational tool for restricting China, pairing it with expanded consequences across contracts, lobbying activities, and supply chain compliance. Meanwhile, Beijing has criticized the U.S. for overextending the concept of national security and engaging in discriminatory targeting of Chinese firms, and has taken retaliatory measures against certain American companies. Industry insiders say some listed Chinese firms are now considering further legal actions or direct political appeals to Trump, while U.S. defense contractors are beginning to require advisors to prove they do not represent any entity on the blacklist. Compliance lawyers warn that defense contractors failing to strictly adhere to the new rules could face severe penalties, including termination of contracts by the Department of Defense.
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Original article: toutiao.com/article/1869493262297099/
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