With the ongoing farce between the US and China, many global tech industries that have their origins in China have suffered. For example, take Huawei, the company’s smartphone segment has been completely decimated due to the restrictions imposed by the US government under ex-president Trump.
Recently, the US Department of Defence has place some restrictions on Chinese smartphone maker Xiaomi that are set to take effect next week. But, a federal judge has blocked the efforts of the US Department of Defence.
Days before the previous president left the Oval Office, the DoD designated Xiaomi as a “Chinese Communist military company” (CCMC), making it subject to Trump’s executive order banning the US from investing in such companies. But according to sources, U.S. District Judge Rudolph Contreras issued a preliminary injunction to prevent what he called “irreparable harm” to Xiaomi, saying the designation was “arbitrary and capricious.”
The categorizing of Xiaomi as a CCMC will ruin the company for a long time and it would suffer “extreme and irreversible damage” to its business and reputation. Xiaomi believes that if the restrictions took effect then the company is as good as ruined. It states that it operates “in compliance with the relevant laws and regulations of jurisdictions where it conducts its businesses.” and also that the company “is not owned, controlled or affiliated with the Chinese military, and is not a ‘Communist Chinese Military Company.’”
The administration under Trump has accused Xiaomi of being a “civilian Chinese company” and also that such organizations allow the Chinese government to “directly threaten the United States homeland.”
Dismissing the argument of the Trump officials, the federal judge stated that “The court is somewhat skeptical that weighty national security interests are implicated here.”
Xiaomi on the other hand has requested the court to permanently remove the CCMC tag from the company.