The US just added the world’s biggest games publisher Tencent to their list of Chinese military companies

Tencent, a Chinese publisher, is considered the largest video game company in the world. They own various subsidiaries such as Riot Games, developers of League Of Legends, Grinding Gear Games, developers of Path Of Exile, and Sumo Group from the UK. Tencent also holds shares in companies like Epic Games, Ubisoft, and Bloober Team, known for the Silent Hill 2 reboot. If you are a game developer, chances are that Tencent has some ownership in your work, even if it’s just a small percentage.

In a surprising turn of events, Tencent has been added to a list of Chinese military companies by the US Department of Defence, along with CATL, a lithium-ion battery maker. This designation could potentially impact Tencent’s business operations in the United States, but Tencent has stated that it’s all a misunderstanding.

The US DoD’s list of Chinese military companies was established by an executive order from former president Donald Trump in 2020. This list, known as Section 1260H, currently includes 134 companies, with Huawei also being one of them. While being on the list doesn’t automatically prohibit business dealings with the US, it does put pressure on the US Treasury Department to impose sanctions. This has already led to a decline in Tencent’s share price in Hong Kong.

Tencent has refuted the claim of being a military company and assures that the designation will not affect their operations. A spokesperson for Tencent stated, “We are not a military company or supplier. Unlike sanctions or export controls, this listing has no impact on our business. We will nonetheless work with the Department of Defense to address any misunderstanding.”

This move by the US is part of a larger effort to restrict China’s economic and military influence, particularly in the tech sector. Given Tencent’s broad range of activities, including generative AI, cloud computing, and ownership of WeChat, it’s possible that they have some military ties. However, similar connections can be found in many large US tech companies.

Amidst these developments, there are reports of Tencent considering a buyout of Ubisoft with support from the Guillemot family. Additionally, two Tencent-appointed directors at Epic Games have resigned in response to a US Department of Justice investigation into potential antitrust violations.