Congressional panel probes US firms' investments in China

SenseTime

20/07/2023 24:13

WASHINGTON, July 19 (Reuters) - A U.S. House of
Representatives committee has launched an investigation into
investments by four U.S. venture capital firms into Chinese
artificial intelligence and semiconductor companies.
    The House Select Committee on the Chinese Communist Party
sent letters on Tuesday to GGV Capital, GSR Ventures, Walden
International and Qualcomm Ventures, the investment arm of
Qualcomm Inc  QCOM.O , asking for information on their
investments in China and setting an Aug. 1 deadline for the
firms to respond.
    In the letters, the committee alleged that investments by
U.S. firms directly contribute to China's human rights abuses,
military modernization and its effort to supplant U.S.
technological leadership.
    The committee said the probe is the first in a series of
investigations into the relationship between the investment
world and the Chinese Communist Party.
    The Biden administration is considering new rules that would
restrict the flow of U.S. investments in Chinese companies
working on advanced semiconductors, artificial intelligence and
quantum computing.
    In its letter to GGV, the panel said the firm had invested
in Megvii Technology, a Chinese company "which actively supports
the surveillance of Uyghurs," a Muslim minority group. The U.S.
blacklisted Megvii in 2019 over its alleged links to China's
treatment of Uyghurs.
    Beijing has denied U.S. allegations of human rights abuses
against Uyghurs.
    The committee said Walden had invested in Intellifusion, an
AI company the U.S. blacklisted in 2020 for allegedly enabling
surveillance of Uyghurs.
    GSR Ventures, the committee said, has invested in companies
linked to the Chinese military, such as Horizon Robotics, which
specializes in AI chips.
    Qualcomm Ventures invested in SenseTime  0020.HK , a company
the U.S. blacklisted in 2019 over its alleged role China's
efforts to profile and track Uyghurs, the committee said.
    GGV, Walden, GSR and Qualcomm did not immediately respond to
requests for comment on the investigation.

 (Reporting by Eric Beech; Editing by Lincoln Feast)
 ((eric.beech@thomsonreuters.com; 202-898-8322; Reuters
Messaging: eric.beech.reuters.com@reuters.net))