Tencent under Fire | What EVERYONE'S Getting Wrong (VL)

Chinese entertainment conglomerate Tencent is at the heart of a large number of video game discussions, but what does the US department of Defense have to say? And how does a byzantine set of american laws create its own kind of journalistic and business nightmare.

We ARE NOT part of any military-civilian fusion...in Virtual Legality.

KEY POINTS
In this episode, Richard Hoeg explores the US Department of Defense's CMC designation and its business impacts on Tencent Holdings. He covers legal background, executive orders, and insights from Bloomberg, analyzing market reactions and clarifying misunderstandings. The discussion includes the National Defense Authorization Act, Trump's executive orders, and more. Hoeg provides historical context, examines Tencent's situation, and the Department of Defense's role in US-China relations. He also considers potential actions by the future administrations and their effects on Tencent's global market presence, concluding with national security debates and possible legal proceedings.

Tencent and CATL have been designated by the U.S. Department of Defense as Chinese military companies, complicating their business operations in the U.S. despite no direct sanctions or bans being imposed.

The designation process stems from the William M. Thornberry National Defense Authorization Act for Fiscal Year 2021, not from former President Trump's 2020 executive order, highlighting the complexity and interlocking nature of U.S. laws regarding international business and defense.

Tencent plans to seek reconsideration and, if necessary, legal proceedings to challenge their inclusion on the list, potentially arguing that the designation is mistaken and not based on substantial evidence.

CHAPTERS
0:00 Introduction and overview of the topic
1:12 US Department of Defense's designation explained and potential business impacts
2:35 Legal background, executive orders, and Bloomberg article insights
3:33 Market reactions, Citigroup analyst perspective, and clarification of sanctions
5:39 Examination of William M. Thornberry National Defense Authorization Act and Federal Register details
7:27 Trump's executive order, section 1237 vs 1260H, and legal implications
10:22 Historical context, reporting requirements, and legislative amendments
13:05 Definitions, implications for Tencent, and legal interpretations
15:04 Department of Defense's discretion and implications for US-China relations
17:23 Potential future actions by the Biden administration and Brookings Institution's perspective
20:49 Specific prohibitions and overview of Tencent's global market presence
22:57 Tencent's gaming investments and impact of US designation
25:02 Clarification on the CMC list, potential legal proceedings, and DJI precedent
30:12 US government actions, national security debate, and closing remarks

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"Virtual Legality" is a continuing series discussing the law, video games, software, and everything digital, hosted by Richard Hoeg, of the Hoeg Law Business Law Firm (Hoeg Law).

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DISCUSSION IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND IS NOT TO BE CONSTRUED AS LEGAL ADVICE. INDIVIDUALS INTERESTED IN THE LEGAL TOPICS DISCUSSED IN THIS VIDEO SHOULD CONSULT WITH THEIR OWN COUNSEL.

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