DJI Sues US Defense Department For Calling It ‘China’s Military Company’

DJI, the world’s largest drone company, is suing to avoid being seen as a tool of the Chinese government. On Friday, it sued the US Department of Defense to remove its name from the list of “Chinese military companies,” saying it has no such relationship with Chinese authorities and has been unfairly victimized by the designation.

Since DJI was added to the list in 2022, the company says, it has “lost business deals, been ostracized as a national security threat, and been barred from contracting with many federal government agencies,” and that its workers “now suffer constant and widespread discrimination” and ” they are repeatedly harassed and insulted in public places.”

It also alleges that the DoD would not provide the company with an explanation for its designation as a “Chinese Military Company” until DJI threatened a lawsuit in September, and says that when the DoD finally presented its reasons, it was riddled with errors.

The US Department of Defense did not immediately respond to a request for comment. You can read DJI’s full argument that it is not owned or controlled by the Chinese military in the complaint below:

Even if the DoD has enough evidence to label DJI this way, it is far from the only US government agency inclined to restrict and scrutinize the company for potential ties to the Chinese government. The US military asked units to stop using DJI Drones in early 2017. In 2019, the US Department of the Interior grounded its fleet of DJI drones due to testing risks.

In 2020, the US Department of Commerce added DJI to its Business List, banning US companies from exporting technology to DJI after it “allowed widespread human rights abuses within China through genetic collection and analysis or high-tech surveillance.”

In 2021, the US Treasury added DJI to its list of Non-SDN Chinese Military Industrial Complexes, documenting that it provided drones to the Chinese government to target Uyghurs, and suggesting that DJI was complicit in human rights abuses. difficult people. as a result.

Some US government agencies have been restricted from purchasing new DJI drones following these various actions. And last week, DJI reported that some of its drones were blocked by US customs using the Uyghur Forced Labor Prevention Act as a reason.

In its defense, DJI has repeatedly stated that it is not owned or controlled by the Chinese government, and that it has “nothing to do with the treatment of Uyghurs in Xinjiang,” and that it simply sells drones that may be used for various outside purposes. of its subsequent control, that many of those targets have served businesses (including first responders) in the United States, and that independent audits by consulting firms and US government agencies (including the DoD) have found no security threats.

Although DJI admits in the complaint that the two Chinese state-owned investment funds have made small investments in the company, it says that the Shanghai Free Trade Zone Equity Fund “owns less than 1% of DJI’s shares and less than 0.1% of DJI’s voting rights.” ,” and that Chengtong Fund ended its investment by June 2023. (DJI says that only four people control 99 percent of DJI and own 87 percent of its shares: Frank Wang, Henry Lu, Swift Xie, and Li Zexiang. )

Congress is also considering a total ban on the import of new DJI and other equipment into the United States on the grounds that they pose an environmental security risk – although that ban is currently on hold. Although the House of Representatives approved it after it was included in the National Defense Authorization Act that must be passed, the Senate version of the bill does not currently contain the ban (although it may add it again).

But until the reservation of the US practices, which DJI suggests is just a misunderstanding, the US government has not taken any steps that would have prevented shops from importing drones, consumers from buying them, or individual pilots from flying in the United States. . Even if Congress bans new DJI drones from being sold, the proposed text of those bills suggests that existing owners can continue to fly their own.