President Trump sent a letter to the Speaker of the House of Representatives Nancy Pelosi and the President of the Senate Mike Pence on Wednesday. The letter mentions an Executive Order to ban US investments in Chinese Military Companies.

The letter says:

I hereby report that I have issued an Executive Order taking further steps to deal with the threat posed by the People’s Republic of China’s (PRC) increasing exploitation of United States capital to resource and to enable the development and modernization of its military, intelligence, and other security apparatuses which continue to allow the PRC to directly threaten the United States homeland and United States forces overseas, including by developing and deploying weapons of mass destruction, advanced conventional weapons, and malicious cyber-enabled actions against the United States and its people.

Through the national strategy of Military-Civil Fusion, the PRC increases the size of the country’s military-industrial complex by compelling civilian Chinese companies to support its military and intelligence activities. Those companies, though remaining ostensibly private and civilian, directly support the PRC’s military, intelligence, and security apparatuses and aid in their development and modernization. At the same time, they raise capital by selling securities to United States investors that trade on public exchanges both here and abroad, lobbying United States index providers and funds to include these securities in market offerings, and engaging in other acts to ensure access to United States capital. In that way, the PRC exploits United States investors to finance the development and modernization of its military.

To deal with that threat, I signed Executive Order 13959 on November 12, 2020. Executive Order 13959 prohibits certain purchases involving publicly traded securities, or any securities that are derivative of, or are designed to provide investment exposure to such securities, of any Communist Chinese military company. Those companies are ones the Department of Defense has listed, or will list, pursuant to section 1237 of Public Law 105-261, as amended, or are identified as Communist Chinese military companies or their subsidiaries by the Secretary of the Treasury using similar criteria.

Today, I signed an Executive Order amending Executive Order 13959. The amendments prohibit certain sales as well as purchases of publicly traded securities, or any securities that are derivative of, or are designed to provide investment exposure to such securities, of any Communist Chinese military company. They also prohibit possession of such securities by United States persons 1 year after a company is determined to be a Communist Chinese military company. And, finally, they allow the Secretary of Defense publicly to list whether a company is a Communist Chinese military company using the criteria in section 1237(b)(4)(B) of Public Law 105-261, as amended by section 1233 of Public Law 106-398 and section 1222 of Public Law 108‑375, regardless of whether the Secretary must report that determination under section 1237(b)(2).

From the White House

President Trump strengthens ban on US investments in Chinese military companies

President Donald Trump signed an order late Wednesday requiring U.S. investors to completely divest their holdings of securities of Pentagon-blacklisted Chinese military companies by Nov. 11, 2021, according to The Epoch Times.

The amendment order expands the scope of the initial November executive order (E.O.) 13959, which initially only restricted U.S. investors from buying securities of companies designated by the Pentagon as owned or controlled by the Chinese military by Nov, 11, 2021.

“[A]ny transaction entered into on or before 11:59 p.m. eastern standard time on November 11, 2021, solely to divest, in whole or in part, from securities that any United States person held as of 9:30 a.m. eastern standard time on January 11, 2021, in a Communist Chinese military company … is permitted. Effective at 11:59 p.m. eastern standard time on November 11, 2021, possession of any such securities by a United States person is prohibited,” the order reads.

The Chinese Communist Party (CCP), through its aggressive national strategy called “Military-Civil Fusion,” uses Chinese companies to strengthen the PLA, Trump’s November executive order states.

The November executive order also noted that the Chinese companies, “though remaining ostensibly private and civilian, directly support the PRC’s military, intelligence, and security apparatuses and aid in their development and modernization.”

It adds, “At the same time, those companies raise capital by selling securities to United States investors that trade on public exchanges both here and abroad, lobbying United States index providers and funds to include these securities in market offerings, and engaging in other acts to ensure access to United States capital.”

“In that way, the PRC exploits United States investors to finance the development and modernization of its military,” the president warned.

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