The U.S. has reportedly delayed blacklisting over 100 Chinese companies, including AI giant DeepSeek and chipmaker CXMT, despite being flagged as national security risks by an interagency committee. This pause, the longest in over a decade for the Commerce Department’s Entity List, is seen by experts as prioritizing de-escalation over national security concerns, potentially allowing American technology to reach adversaries. The move comes amid a fierce tech rivalry, with officials reportedly fearing escalating tensions by adding new firms to the trade restriction list.
In a significant move that signals a potential de-escalation of U.S.-China tensions, Washington has reportedly paused the blacklisting of more than 100 Chinese companies, including prominent AI startup DeepSeek and memory chipmaker CXMT. These firms had previously been flagged by an interagency committee for posing national security risks, a revelation exclusively reported by Reuters.
HONG KONG, CHINA - 2025/03/01: In this photo illustration, Artificial intelligence (AI) apps of perplexity, DeepSeek and ChatGPT are seen on a smartphone screen.
Sopa Images | Lightrocket | Getty Images
DeepSeek, known for its low-cost AI model that made waves in early 2025, has been accused by a senior U.S. State Department official of supporting China's military and intelligence operations and attempting to illicitly acquire advanced U.S. chips via shell companies in Southeast Asia. Other major AI labs like Anthropic and OpenAI have also reported DeepSeek's alleged efforts to extract capabilities from their models.
ChangXin Memory Technologies (CXMT), China's leading memory chipmaker, was designated a Chinese military company under the Biden administration, with discussions about placing it on the Commerce Department's Entity List occurring over a year ago. Inclusion on this list would prohibit U.S. companies from shipping goods, software, and technology without a difficult-to-obtain license.
Neither DeepSeek nor CXMT were available for comment, and the Commerce Department's Bureau of Industry and Security (BIS) declined to comment directly on the reasons for the delay in publishing Entity List updates, stating only that it uses various tools to combat "bad actors."
Tense Rivalry, Stalled Action
The deferral comes amidst a fierce technology, trade, and national security rivalry between the U.S. and China. The U.S. has not made any additions to its Entity List since October, marking the longest such pause in over a decade, according to Philip Luck of the Center for Strategic and International Studies. Luck warns that this inaction may be allowing American technology to reach adversaries.
Former Commerce Department official Kevin Kurland echoed these concerns, stating, "The fact the U.S. hasn't put any companies on the Entity List since October demonstrates that trade policy is overshadowing the use of a critical national security tool."
Among the companies reportedly approved for blacklisting but not published are multiple Chinese firms accused of supplying Russian drones recovered in Poland last September, and dozens more for selling restricted Nvidia chips to Chinese universities. Manufacturers of drones and robot dogs for China's military were also reportedly targeted.
Sources indicate that Jeffrey Kessler, Under Secretary of Commerce for Industry and Security, has actively sought to avoid new listings since late 2025, fearing an escalation of U.S.-China tensions. This reluctance highlights what many see as a broader issue within the second Trump administration's Bureau of Industry and Security: a struggle to implement new rules and combat threats through export restrictions. An example is the delay in replacing a Biden-era regulation on global access to U.S.-origin AI chips, which has created a potential loophole for chip exports outside China.
Despite an interagency committee—comprising officials from Commerce, Defense, Energy, State, and sometimes Treasury—having approved at least 75 Chinese entities in advanced semiconductor production, equipment, and AI modeling for blacklisting, these decisions remain unpublished by the Commerce Department.
