Unlock the White House Watch newsletter for free
Your guide to what the 2024 US election means for Washington and the world
The chair of the House China panel has urged JPMorgan Chase and Bank of America to halt work on the Hong Kong listing of Chinese battery maker CATL, in a further escalation of Washington’s bid to pressure Beijing.
John Moolenaar, the Republican lawmaker who heads the China panel in the US House of Representatives, made the request in separate letters to JPMorgan’s chief Jamie Dimon and BofA’s CEO Brian Moynihan, which were published on Thursday.
The letters are the latest sign of how the US is seeking to use its economic heft to ratchet up the pressure on Beijing. President Donald Trump earlier this month put tariffs of 145 per cent on many Chinese imports in a move that will probably hit both economies.
The Pentagon has placed CATL on a list of companies with alleged ties to the Chinese military. While such listings have no legal impact, they serve as a warning that the US government has concerns about the listed entities. Lawmakers have also raised concerns about US carmakers using batteries manufactured by CATL.
In the letters, Moolenaar told the banks that continuing to underwrite the initial public offering would expose themselves and American investors to “significant regulatory, financial, and reputational risks”.
Moolenaar said US lawmakers had previously expressed concern about reports that the People’s Liberation Army Navy may soon use CATL’s lithium-ion batteries to power non-nuclear submarines.
Moolenaar told the chief executives that if their banks did not withdraw from the IPO, “it risks supporting a company linked to the ongoing genocide of Uyghur Muslims in Xinjiang, China, the erosion of American manufacturing, and the engagement of US service members”.
“We are troubled by reports indicating that JPMorgan and other American banks aggressively pursued the IPO of Chinese military company CATL despite clear and public knowledge of CATL’s military-related designation and associate with sanctions entities,” Moolenaar wrote in the letter to Dimon.
The Chinese government has repeatedly denied that it has engaged in human rights abuses in Xinjiang. CATL has previously denied that it has any connection to the Chinese military or entities that have been accused of human rights abuses in Xinjiang.
The Chinese embassy in Washington has been approached for comment. BofA and JPMorgan declined to comment.
Moolenaar noted that a recent memo released by the Trump administration “explicitly aims to prevent Wall Street from funnelling American retail investors retirement and other funds into companies that support the Chinese Communist party’s military-industrial complex and human rights abuses”.
CATL in February formally filed for a secondary listing in Hong Kong, with JPMorgan, BofA, China’s CICC and China Securities International as lead banks. Goldman Sachs, Morgan Stanley and UBS were also on the deal, despite the battery maker’s addition to the Pentagon blacklist. It is already listed on China’s Shenzhen bourse.
The company planned to list about 5 per cent of its total share capital in Hong Kong, in a deal that many hoped would be the territory’s largest share offering in years. Morgan Stanley had previously estimated the battery maker could raise more than $7bn.
The China panel has among the most bipartisan unity among congressional committees as lawmakers across the aisle become increasingly concerned about security threats posed by China. However, the letters to the bank CEOs were not signed by Raja Krishnamoorthi, the top Democrat on the panel.