The Chinese smartphone provider Xiaomi has won a stage victory in its fight against US sanctions still imposed by the Trump administration. A judge in Washington suspended the punitive measures, according to court documents released over the weekend. This includes the ban on American investors from buying Xiaomi shares, which should take effect next week. As of January 2022, they should also part with shares they already hold.
Embarrassing breakdown by the US Department of Defense
However, the judge granted Xiaomi’s request for an injunction against the sanctions. The US Department of Defense had not adequately justified and exceeded its powers, he wrote to justify. In an embarrassing mishap, the legal provision on which the procedure is based was also incorrectly quoted. “These mistakes do not create confidence in the thoroughness of the decision-making process,” he said.
The Ministry of Defense blacklisted Xiaomi shortly before the end of President Donald Trump’s term of office on allegations of links to the Chinese military. Xiaomi denies the allegations and has filed a lawsuit against the decision.
The administration of the new President Joe Biden can reverse the sanctions. It has already suspended the action taken by Trump against Chinese services such as the WeChat chat service and the Tiktok video app for further review.
Trump had portrayed China as the greatest international threat to the US over the years and, among other things, claimed during the election campaign without any evidence that Biden had been bought by Beijing.
Trade conflict: against Chinese companies
Trump’s government intensified a trade conflict with China and also took action against various Chinese companies. Huawei was hit hardest. The network supplier and smartphone provider lost access to American technology – because of the allegation that the Chinese government could force him to cooperate far-reaching. Huawei rejects this. Xiaomi benefited from Huawei’s problems in the smartphone business.
Xiaomi grew up selling cheap but technically sophisticated smartphones on the Internet. The company now has all sorts of devices on offer, from televisions to rice cookers.