Hikvision and Dahua banned from buying U.S. exports

Hikvision and Dahua have been added to a U.S. government list of entities “reasonably believed to be involved, or to pose significant risk of being or becoming involved, in activities contrary to the national security or foreign policy interests of the United States.”

In effect, inclusion on the list restricts the export of equipment to the two companies because of their alleged involvement in “human rights violations and abuses” related to a Chinese government campaign of repression, mass arbitrary detention, and high-technology surveillance against minority groups. Hikvision and Dahua have contracts to sell equipment that provides video surveillance capabilities in the Xinjiang Uighur Autonomous Region (XUAR) of China. The minority groups targeted are Uighurs, Kazakhs and other Muslim minorities. Hikvision and Dahua have contracts to sell equipment that provides video surveillance capabilities in the Xinjiang Uighur Autonomous Region of China

The decision to add Hikvision and Dahua, among 26 other “entities,” to the list was made by the United States End-User Review Committee (ERC), composed of representatives of the Departments of Commerce, State, Defense, Energy and (where appropriate) Treasury. A majority vote of the panel is required to add an entity to the list, and a unanimous vote is required to remove or modify an entity. The 26 other entities include the Chinese government’s bureau in XUAR, 18 subordinate municipal and county public security bureaus and one other subordinate institute.

Specific licenses (government approval) are required for any transaction in which items are exported, reexported, or transferred (in country) to any of the entities on the list; or in which the entities act as purchaser, consignee or end user. Loosely speaking, inclusion on the list prevents Hikvision and/or Dahua from buying any component parts from U.S. manufacturers.

Indirectly and more broadly speaking, the measure affords a new downside to the Dahua and Hikvision brands in the U.S. market. Anyone concerned about human rights abuses might hesitate to buy from the two companies, although the entity list does nothing to prohibit sales of the company’s products.

Dahua and Hikvision statements 

In a company statement, Dahua has “express[ed] strong protest to such decision, which lacks any factual basis, and call[ed] on the U.S. government to reconsider on it.”’

Indirectly and more broadly speaking, the measure affords a new downside to the Dahua and Hikvision brands in the U.S. marketThe Dahua statement continues: “As a global business entity, Dahua adheres to the business code of conduct, and follows market rules as well as international rules. Dahua is actively working to ensure our investment and business operations around the world comply with all applicable laws and regulations. Regarding the decision of U.S. government, we have actively taken various measures, and we will continue providing outstanding products and services to our customers.”

Hikvision has released the following statement: “Hikvision strongly opposes [the] decision by the U.S. Government and it will hamper efforts by global companies to improve human rights around the world. Hikvision, as the security industry’s global leader, respects human rights and takes our responsibility to protect people in the U.S. and the world seriously. Anyone concerned about human rights abuses might hesitate to buy from the two companies

"Hikvision has been engaging with Administration officials over the past 12 months to clarify misunderstandings about the company and address their concerns. In January 2019, Hikvision retained human rights expert and former U.S. Ambassador Pierre-Richard Prosper to advise the company on human rights compliance. Punishing Hikvision, despite these engagements, will deter global companies from communicating with the U.S. Government, hurt Hikvision’s U.S. businesses partners and negatively impact the U.S. economy.”

“The U.S. Government and Department of Commerce cannot and will not tolerate the brutal suppression of ethnic minorities within China,” said Secretary of Commerce Wilbur Ross in making the announcement. “This action will ensure that our technologies, fostered in an environment of individual liberty and free enterprise, are not used to repress defenseless minority populations.”