US Government Puts Export Control On Hikvision's Chinese Government Parent

By: Charles Rollet, Published on Aug 07, 2018

Chinese media and the Chinese stock market have not only been concerned about the NDAA bill banning Hikvision for US government use. Additionally, Chinese media has been reporting that "The United States sanctions 44 Chinese companies!", including mentioning the stock impact on Hikvision.

The US government has placed strict restrictions on exporting products to a select number of Chinese entities, including on numerous subsidiaries of Hikvision’s parent company CETC, but not Hikvision itself.

Inside this note, we examine what this means, how Hikvision is related to this and what the potential impact to Hikvision could be.

******* ***** *** *** Chinese ***** ****** **** not **** **** ********* about ******* **** ******* ********* for ** ********** ***. ************, ******* ***** has **** ********* **** "*** ****** ****** ********* 44 ******* *********!", ********* ********** *** stock ****** ** *********.

*** ** ********** *** placed ****** ************ ** exporting ******** ** * select ****** ** ******* entities, ********* ** ******** subsidiaries ** *********’* ****** company ****, *************** ******.

****** **** ****, ** examine **** **** *****, how ********* ** ******* to **** *** **** the ********* ****** ** Hikvision ***** **.

[***************]

Entity **** - '*********** ** ******'

** ****** *, **** the ** ******** ****************** ******* “********” ** *** “Entity ****.”

***** ***** ********* ** ********** *** want ** **** ***** to ***** ***** ***** are ********* ** *** Export ************** ***********, **** as ********* *** ***********, must ****** * *******. ********* **** * ******* is ****** ********* ** the ******* ****** ****** officially ******** ***** * “presumption ** ******.”

** *** ** ***** Department ******** [**** ** longer *********]:

*** *.*. ********** ******** exports ** ********* *********, software *** ********** ** a ***** ** ******* our ******** ******** ********* and ******* ****** **********

Impacted - *** ** *****, ******, ***** ******** **********

** ********* *****, *** key ****** ** **** controls ** ***** ******** company **********, *.*., ***** and ******.

***** ****** *** ******** ** *** *** **** its "************** ******** *** subject ** *** ****** Regulations, *** ***** (********* its ************ *********) *** an ****** ******* ** place ** **** ***** export ********** ***********." *** commerce **********'* **** ** ********** *********** ****** **** ** ********* all ************* **** *********** speed ** * ****** or **** *** **-*** or ****, ** * clock ********* **** ********* 25 ***. ***** ********* detailed ***** ** *** products' ***** ************ *** ****** ********** ********. *** **** ***** beyond ***** ******* *** requirements. ** ** *******, the **** ** ********** used ** **** ***** ****, *****'* ** ******, all *** **** **** than * ****** *** are **-***.

****** *****'* ******** ******* the ******** **** ***** does ***** *** *****' export ********, *******, *** high ***** ** *** DGX-1 ****, ***** ** is ******* **** *********, **** *** ******* *** ********.

Global ******

*** ****** ** **** export ********, ****** ** tariffs, ***** ** **** globally, ***** ** ***** block *** *** ** US ********** ** ******-********** Chinese ******** ********** ** where ***** ******** **** ultimately **** (*.*., *** US, **, ******, *****, etc.).

CETC ******* ********

** *** ** ******** added, ** *** ********** by ******** *********** ********** [**** no ****** *********]*****: * ******** ********** and ** ** ***** subsidiaries. *** **** ** a *****, ***% *****-***** defense *** ** ************ that **** * ***** number ** ******** *** scientific ******** ********** (********* *********).

*** ********** ******** *** their ***** ** ********* are:

  • ************ *********, ***** (**************)
  • ************ *********, ******* (*****; it ** ***** ** the********** [**** ** ****** available]” ** *****’* ***** industry)
  • ************ *********, ***** (***** *** ******** *********** [link ** ****** *********])
  • **** ******** *********, ******* (**************** *** ***** ** ******** products )

Reasoning *** ***** ************ ******

*** ******** ********** ****** the ************ **** ******* due ** *** ********** illegally ***** ******** *** military *** ** *****, noting:

** ********** ***** ** believe, ***** ** ******** and *********** *****, **** all ** ***** ******** are ******** ** *** illicit *********** ** *********** and ************ *** ************ military ***-*** ** *****

** **** ******** ******* were ********.

*** ******** **** **** believed “** ** ********, or ** **** * significant **** ** ***** or ******** ********, ** activities ******** ** *** national ******** ** ******* policy ********* ** *** United ******.”

**** ** *** ******** mentioned ** *** **** appear ** ** ******** involved ** ***** ************ production, ** ** ****** ****** of ***** ************ ** Hikvision *** *** ********.

CETC *** *********

*********’* *********** *********** ** CETHIK, ***% ***** ** the ****, ***** *** CETC's **** ******** ********* owns ******* ***** ******* of ********* ** ******** in *********’* ****** ********* ******. *********’* ********, **** Zongnian, ** **** *** director ** *** **** *********. The ******* ***** ***** the ************:

********* ******* **** ***** to *** **** ******. According ** ***** **** **********, ********* ** “*** most ********** ****** ***** CETC” *** ** **** accounted *** **.*% ** the ************’* ****** *******. ********* ****** **** *** of *** ****’* **** ******** ********* ** ********, which ** ******* ***** to.

Worrying ************ *** *********

*** ******** ** ****** restrictions ******* **** ******** institutes **** * ******** precedent *** *********. **** ************ *** * bureaucratic ******** ** ** obscure ****, ****** **** ************* easier ** ****** *********** * ************* **** - ** ******** ** votes *** ******** ************ ********************** *** ** ********* a **** ** ****** that ******* ** *** the ************ ********* *** ********* on *** ****** ****.

*******, ********* ******* *** a *********** ************ **** the ******* ********, **** as * ******* **********-***** surveillance ************ *** ** China's ******** ********. *** example,*********'* ******** **** * speech ******* ** **** touting'******** ********' ***********, ********** with * **** ****** ******** ** ******* ***** media ***** ** ********* touted**** '******** ********' *********** featuring *********.

** ********* ** *** 52nd ********* **** ***** to *** ****** ****, Intel ** ****** ***** need ** *** ****-********** licenses ** ****** ***** products ** *****. *** the ******** ********** ***** even ******** *** *** ****** ** *** regulated ***** - ********* the licensing process ********** - ** they ***** ***** ***** were ***** **** **** a ******* ********-*** **** in ******* ***** ** *.*. *****.

*******, ********** ************* *****-** ********* *** to ********* *****’* ***** war, ***** ** ** ********* that **** *** ** the **** ** *** future.

Comments (7)

*******, **** *********!

*** ***** ******* ***** that ******* *** **** looking **, **** *** not **** *** *****, is ************* **** ** ******* ***** own ** ****. ** ***** **** of **** ********** ** the ******* / **** of ***** ******* *** of ******** ********* **** Nvidia *** ***** ********* with **** ********** ****** discussed ****.

*** ** *** ***** this **** ***** ******, ask ********, * **** ago *** *** ******* that *** ** ********** would **** *** ********* for ** ********** ***?

*** ***** **** ****** the ***** ** ******* line ***** *** *** chips ** ** ******** based **********.

**** ***** *********** *** Hikvision *** ** ********

**-***** *************, ** ******** *******. Note: ** ****** (*.*. TVI) ** * ******** minority ** *********'* ******* business. We **** **** **** whether ** *** **** would ** *******. * had *** ******* ** that ** ****** *** raising **.

**, **** ** * good *****. *********** ******* ************:

********/******* ** ******** *******

********/******* ***** (********** ********* ********** *******),

********/******* ** ******** ****** technology

***** *** **** ******* requirements ** ** ***, however. ******* ** ** **** document:

********* ** *********** ***** 2.7 ***, *** *** of *** *********:

*.**.*. * **** ********* power ****** (** *****), Psat, ******* **** ***.** divided ** *** ******* operating ********* (** ***) squared [****>***.** ****** /**** 2 ] *** *** channel

*.**.*. * “********** *********” of *% ** ******* for *** *******

*.**.*. *** ****** **** with ****** * (** cm) ***** ** ** less **** ** ******* by *** ****** ********* frequency ** *** [* **********/****] ***** * is *** ****** ** transmit ** ********/******* ********

*.**.*. ** ************** ******** phase ******* *** *******.

 

*'* *** **** ** restricting ****** ** ******* companies ** ******* ************ is *** **** ******** move ** **** ***** game. ***** ** ***** be ****** ** *** government ********** ********* ** Intel/Nvidia ***** *** **** the ******** *** *** cheapest ******** ***** ** that *** ********* **** their *** *********** *** get ********* ** *** technology. ***** **, *** government ***** *** *** backdoors *** *** *** chips **** ******* ******* secrets ** * *********** server?

 

****, ** *** ***** what * *****? ***** someone *** **** **** before? :)

********** **** ***** *** a *** **** - just *** ********* - that’s *** **** *** into **** ***** **** in *** ***** *****:

** **** - ****, *** being * ***** ***** enterprise *** * ************. 

********* ****** *** ****** capitalization:

** **** ****/***: **.** / **.**

News ******:

******* ***** ***** (*-**) and *********** ***** ***** (R-NJ) **** ******** * *** ****** calling *** ******** ********* ***** *** ******* ****** Hikvision *** *****. **** is**** ******* ***** *** ******, ***** asks *** ******** ********** to *** ******** *********** and "*** ********** ********* from *** ********* ** the ******'* ***** ** security ********" (*.*. ********* *** *****) ** *** ** government's ****** ****.

***** ***** ** *** Entity **** ** **** serious **** ****** ********* but ***** *******.

** ********* *****, ** means ** ********** *** persons ******* ** **** most ********* ** ****** Listed-firms **** ***** ***** for * ******* **** the ******** **********. ***** licenses *** **** ********* to ******, ********** ********* a "*********** ** ******" policy. **** ** * double ****** *** ********* and *****, *** *** now ******** ***** ****** of ****** ********* (******** Dept) *** ****** **** (Commerce ****) *********.

***** ***** ** *** Entity **** ***** ******* if ********* *** ***** are ******* ********** ***** Global *********, ***** ***** ban *** ************ ******* them *** ** ********. However, *** *** **** could **** *** ** that ********* *** ***** do *** *** ********** under ********* *** *** still ****** ** *** Entity ****.
 
**** ** **** ****** than ********* ***** ** does *** ****** ***** US ****** ** *** all **-******* ************. *** it ***** ***** **** their ****** *****, ********* making ** ****-*********** *** ** ***** **** ********* to ****** ***** ** them.
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