US court blocks all DoD restrictions VS Xiaomi

Chris Burns - May 28, 2021, 9:29am CDT
US court blocks all DoD restrictions VS Xiaomi

Today Xiaomi announced that they’d received word from the United States Department of Defense that they’re no longer considered a CCMC. A CCMC is a Communist Chinese Military Company. Along with the removal of this designation comes restrictions on business dealings inside the United States and with U.S. persons’ ability to purchase or hold securities of the company. Those restrictions have been lifted.

Over the past few years, the United States government has had some rather public dealings with China-based companies like Huawei, ZTE, and Xiaomi. In January of 2021, Xiaomi was blacklisted by the U.S. Department of Defense. This blacklisting was authorized by Section 1237 of the National Defense Authorization Act for Fiscal Year 1999 (Public Law 105-261), naming Xiaomi as a Communist Chinese military company.

It was just before the end of Donald Trump’s term as U.S. President that the United States government enacted this order that would have blocked U.S. entities from investing in Xiaomi. In March of 2021, this restriction was blocked for the first time. In mid-May, court documents suggested Xiaomi would be removed from the blacklist altogether.

As of this week, Xiaomi announced that on May 25, 2021, at 4:09 PM (Eastern Standard Time), the U.S. District Court for the District of Columbia “issued a final order vacating the U.S. Department of Defense’s designation of the Company as a CCMC.” Because of this vacating of said order, the court “formally lifted all restrictions on U.S. persons’ ability to purchase or hold securities of the Company.”

It’s entirely possible this means Xiaomi will be slightly more able to bring more products to the United States for sale to the average citizen, but it will not affect the way Xiaomi remains subject to patent laws in the USA. If no patent laws existed, we’d likely already see massive amounts of Xiaomi smartphones available for sale in the United States – but for now, they’re mostly doing business with U.S. consumers with devices like power banks, projectors, lamps, and power sockets. They also have home security cameras and LEGO-like robot building kits (which are pretty neat!)


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