Executive Order 13959 is a
U.S. Presidential Executive Order
In the United States, an executive order is a directive by the president of the United States that manages operations of the federal government. The legal or constitutional basis for executive orders has multiple sources. Article Two of the ...
signed on November 12, 2020, by President
Donald Trump
Donald John Trump (born June 14, 1946) is an American politician, media personality, and businessman who is the 47th president of the United States. A member of the Republican Party (United States), Republican Party, he served as the 45 ...
. Its title, and stated goal, is "Addressing the Threat From Securities Investments That Finance Communist Chinese Military Companies."
A related
Executive Order 14032 ("Addressing the Threat From Securities Investments That Finance Certain Companies of the People's Republic of China") was signed by President
Joe Biden
Joseph Robinette Biden Jr. (born November 20, 1942) is an American politician who was the 46th president of the United States from 2021 to 2025. A member of the Democratic Party (United States), Democratic Party, he served as the 47th vice p ...
on June 3, 2021. The national emergency declared by E.O. 13959 remains in effect and has been expanded by E.O. 14032.
Prohibiting investment in "Communist Chinese military companies"
The executive order prohibits all U.S. investors (
institutional
An institution is a humanly devised structure of rules and norms that shape and constrain social behavior. All definitions of institutions generally entail that there is a level of persistence and continuity. Laws, rules, social conventions and ...
and retail investors alike) from purchasing or investing in securities of companies identified by the U.S. government as "Communist Chinese military companies". A "Communist Chinese military company" is any company that the
U.S. Department of Defense has identified pursuant to Section 1237 of the
National Defense Authorization Act for Fiscal Year 1999. The prohibition came into effect on January 11, 2021.
On December 28, 2020, guidance on the executive order was published clarifying that the order included subsidiaries of the relevant companies. On January 13, 2021, President Trump strengthened the executive order's requirements by issuing Executive Order 13974 ("Amending Executive Order 13959—Addressing the Threat From Securities Investments That Finance Communist Chinese Military Companies"), which mandated
divestment
In finance and economics, divestment or divestiture is the reduction of some kind of asset for financial, ethical, or political objectives or sale of an existing business by a firm. A divestment is the opposite of an investment. Divestiture is a ...
by November 11, 2021.
List of affected companies
Initially, 31 companies were identified, including two companies whose
shares
In financial markets, a share (sometimes referred to as stock or equity) is a unit of equity ownership in the capital stock of a corporation. It can refer to units of mutual funds, limited partnerships, and real estate investment trusts. Sha ...
were traded on U.S. exchanges. These include companies in
aerospace
Aerospace is a term used to collectively refer to the atmosphere and outer space. Aerospace activity is very diverse, with a multitude of commercial, industrial, and military applications. Aerospace engineering consists of aeronautics and astron ...
,
shipbuilding
Shipbuilding is the construction of ships and other Watercraft, floating vessels. In modern times, it normally takes place in a specialized facility known as a shipyard. Shipbuilders, also called shipwrights, follow a specialized occupation th ...
,
construction
Construction are processes involved in delivering buildings, infrastructure, industrial facilities, and associated activities through to the end of their life. It typically starts with planning, financing, and design that continues until the a ...
,
technology
Technology is the application of Conceptual model, conceptual knowledge to achieve practical goals, especially in a reproducible way. The word ''technology'' can also mean the products resulting from such efforts, including both tangible too ...
and
communication
Communication is commonly defined as the transmission of information. Its precise definition is disputed and there are disagreements about whether Intention, unintentional or failed transmissions are included and whether communication not onl ...
industries.
On December 3, 2020, the
Department of Defense
The United States Department of Defense (DoD, USDOD, or DOD) is an executive department of the U.S. federal government charged with coordinating and supervising the six U.S. armed services: the Army, Navy, Marines, Air Force, Space Force, ...
designated four additional companies as owned or controlled by the Chinese military, taking the total number of affected companies to 35.
On January 14, 2021, the Department of Defense designated nine additional companies as owned or controlled by the Chinese military, taking the total number of affected companies to 44.
Delistings
As a consequence of the executive order, the
New York Stock Exchange
The New York Stock Exchange (NYSE, nicknamed "The Big Board") is an American stock exchange in the Financial District, Manhattan, Financial District of Lower Manhattan in New York City. It is the List of stock exchanges, largest stock excha ...
in January ended trading of shares in China Mobile, China Telecom and China Unicom, and announced in late February that trading in CNOOC would also cease on March 9, 2021.
See also
*
Executive Order 14032
References
{{Authority control
China–United States relations
Executive orders of Donald Trump
Sanctions against China
United States sanctions