Blacklisted state-affiliated Chinese military companies are quietly rebranding as American tech firms amid Washington's anti-China movements.
According to The Wall Street Journal, several Chinese firms considered national security concerns have rebranded as American-led firms to keep selling their products in the US.
The report cited one automaker, American Lidar, a subsidiary of the Chinese-based lidar maker Hesai Group after it was banned from selling its products in the US earlier this year.
The same happened with Chinese drone maker SZ DJI Technology, which was prohibited from selling its drones to US consumers and the government amid claims of the drones sending data to the Chinese government.
To skirt around the ban, the company licensed its drone models through a new US startup Anzu Robotics.
The trend matches Huawei's previous moves by launching a separate US-based entity, Futurewei, in 2019 while the government pushed for its ban over "unacceptable risk" to national security.
Chinese 'Shell Game' to Heighten Amid Regulatory Crackdowns
With the White House passing its biggest legislation to date against Chinese companies, lawmakers fear that the "shell game" of company rebrands would only further intensify.
Since the rebranding is legal under US laws, lawmakers and regulators have a harder time proving that the companies indeed pose national security concerns to the country.
So far, only a few rebranded Chinese firms have been added to the Pentagon's blacklisted Chinese military entity list.
Will the Same Happen on TikTok?
Despite having the same prohibitions loom over TikTok, the video-sharing platform declared intentions to fight the law forcing the app out of the US in the legal stage.
TikTok CEO Shou Zi Chew previously vowed that "we aren't going anywhere" as it poses to fight for its rights in the legal court.
@tiktok Response to TikTok Ban Bill ♬ original sound - TikTok
TikTok and its parent company, Beijing-based ByteDance, argued that the Protecting Americans from Foreign Adversary Controlled Applications Act stifles the First Amendment by essentially banning the app from the US.
Lawmakers have previously urged ByteDance to sell the platform to a US-based company to avert the ban, the same strategy employed by other Chinese companies.
So far, only Chinese phone maker Xiaomi has successfully revoked the US probation without resorting to a different subsidiary.
