Xiaomi announced legal measures to avoid the blockade of the United States, and the judges give them the reason by removing them precautionary from the ‘blacklist’ of the Washington administration.
US court upholds Xiaomi, temporarily lifts ban
A few days ago we commented on what could be the real reasons for Donald Trump’s veto of Xiaomi, and it seems that the Chinese Ministry of Industry and Information Technology had given an award to Lei Jun with a rather strange designation: “Outstanding builder of socialism with Chinese characteristics”.
In any case, it was not a complete blockade like the one suffered by Huawei, but rather the inclusion of Xiaomi in a list of suspicious companies that would be investigated with a magnifying glass from the United States, wielding some links with the Chinese military that the Haidian firm flatly denied, announcing that they would take legal action to regain their credibility in the important North American market.
U.S judge has issued an order granting Xiaomi a mini-victory in the first instance, which temporarily removes the Chinese manufacturer from the blacklist and calls on the US authorities to demonstrate that there are clear indications that Xiaomi represents a danger to the national security of the United States.
And yes friends, this process against Xiaomi has always left a different feeling than the one initiated against ZTE or Huawei, with a taste of stiltedness that lets us glimpse that litigation will continue without us knowing, for now, the intentions of the new administration of Joe Biden regarding trade agreements with China and the vetoes enacted by Trump.
It should be recalled that the US Department of Defense had included Xiaomi on a blacklist of companies suspected of links with the Chinese military, initiating certain sanctions and financial restrictions that would take effect soon, and against which Xiaomi had already announced an appeal to the courts.
Judge Rudolph Contreras suspended the financial measures taken against Xiaomi, as well as its inclusion in the ‘blacklist’, summoning the Biden administration to demonstrate that they are indeed a danger to the security of the United States.
The judicial recourse that seems to have been effective, as Judge Rudolph Contreras has just ruled in favor of the Haidian manufacturer, leaving the sanctions without effect and temporarily removing Xiaomi from the blacklist, indicating that this precautionary measure is taken to prevent Xiaomi from suffering irreparable damage to its reputation or its financial stability.
The court order says that the links that Xiaomi also denies with the Chinese military have not been proven and that neither the Department of Defense nor the U.S. Treasury Department has been able to “demonstrate that national security interests are at stake”. Specifically, moreover, they indicate that “the court is somewhat skeptical that Xiaomi is involved in schemes that could endanger the United States”.
From the company they have again stated that they comply with all international protocols to trade both in the United States and in other markets, again denying any involvement with the Chinese military beyond commercial agreements and stating that they will continue with the judicial processes to have their inclusion in the aforementioned blacklist declared illegal.
We will see on Monday how the markets breathe because for sure Xiaomi’s share price is going to recover after this turn of events… Don’t you think?
