Section 1260H Chinese Military Companies List (DoD)

The Section 1260H List is a public registry maintained by the United States Department of Defense identifying entities operating directly or indirectly in the United States that the Secretary of Defense determines to be "Chinese military companies." The list takes its name from Section 1260H of the William M. (Mac) Thornberry National Defense Authorization Act for Fiscal Year 2021 (Public Law 116-283), which directed the Pentagon to begin publishing such identifications no later than 2021 and to update them annually. Section 1260H superseded and broadened the earlier statutory regime under Section 1237 of the Strom Thurmond National Defense Authorization Act for Fiscal Year 1999, which had imposed a similar identification requirement but produced a list the Pentagon had not consistently updated until congressional pressure in 2020. The statute defines a Chinese military company by reference to ties with the People's Liberation Army (PLA), the Chinese Ministry of State Security, or the People's Armed Police, and incorporates the concept of China's "Military-Civil Fusion" (军民融合) strategy as a criterion.

Procedurally, the Office of the Under Secretary of Defense for Policy compiles candidate entities through interagency consultation with the intelligence community, the Departments of Commerce, State, and the Treasury, and open-source analysis. Candidates are screened against two statutory prongs: whether the entity is owned, controlled by, or affiliated with the PLA or Chinese security services and contributes to the Chinese defense industrial base; or whether it is identified as a "military-civil fusion contributor" to the People's Republic of China. Once the Secretary of Defense (or a designee, typically the Under Secretary for Policy) approves the determination, the names are transmitted to the relevant congressional committees and published in the Federal Register. Listed entities may petition the Department for delisting and may seek judicial review under the Administrative Procedure Act in the U.S. District Court for the District of Columbia.

The list itself does not, by its own force, impose sanctions, export controls, or transaction prohibitions. Its legal weight derives from downstream consequences. Section 1260H designations function as authoritative findings that have been incorporated into Executive Order 13959 (issued by President Trump in November 2020) and its successor, Executive Order 14032 (issued by President Biden in June 2021), which prohibit U.S. persons from transacting in publicly traded securities of designated "Chinese Military-Industrial Complex Companies" administered by the Treasury Department's Office of Foreign Assets Control through the Non-SDN Chinese Military-Industrial Complex Companies List (NS-CMIC List). The 1260H designation also informs procurement bans, supports Commerce Department Entity List actions under the Export Administration Regulations, and feeds into reviews by the Committee on Foreign Investment in the United States (CFIUS).

Among the highest-profile listings have been the aviation conglomerate Aviation Industry Corporation of China (AVIC), the China State Shipbuilding Corporation (CSSC), China Mobile, China Telecom, the surveillance technology firm Hikvision, the drone manufacturer SZ DJI Technology, the lithium-ion battery producer Contemporary Amperex Technology Co. Limited (CATL), the memory chip maker Yangtze Memory Technologies (YMTC), the genomics firm BGI Group, and the shipping company COSCO, added in the January 2025 update. The January 2024 and January 2025 updates published by the Pentagon expanded the list to over 130 entities, prompting public objections and, in several instances, federal lawsuits — notably by Xiaomi Corporation (which secured a 2021 preliminary injunction and subsequent delisting) and by Hesai Group and DJI, which filed APA challenges in 2024.

The Section 1260H List should be distinguished from several adjacent instruments. It is not the Commerce Department's Entity List, which directly imposes export licensing restrictions under the EAR. It is not the Treasury's Specially Designated Nationals (SDN) List, which freezes assets and imposes blocking sanctions under IEEPA. Nor is it the NS-CMIC List, which restricts securities transactions; although 1260H designations often precede or parallel NS-CMIC listings, the two are administered by different departments under different authorities. It is also distinct from the Uyghur Forced Labor Prevention Act Entity List maintained by the Forced Labor Enforcement Task Force, and from the FCC's Covered List of communications equipment posing national security risks.

Controversy has centered on the criteria for "military-civil fusion contributor," which critics argue is vague and overbroad, capturing dual-use commercial firms with attenuated PLA ties. The Xiaomi litigation (Xiaomi Corp. v. Department of Defense, D.D.C. 2021) faulted the Department for failing to provide substantial evidence; subsequent updates have included longer administrative records. The FY2024 NDAA added Section 1346, which, beginning in June 2026, will prohibit the Department of Defense itself from contracting with entities on the 1260H List, transforming the list from an informational document into a binding procurement bar. The FY2024 NDAA also extended the prohibition to entities providing certain services to listed companies, raising compliance burdens on U.S. logistics providers, lobbyists, and consultants — provisions targeting firms such as those represented in Washington advocacy efforts on behalf of CATL and Hesai.

For the practitioner, the Section 1260H List is a primary reference document for due diligence on Chinese counterparties, a leading indicator of forthcoming Treasury and Commerce action, and an increasingly consequential constraint on supply chains involving defense contractors. Investment compliance officers, export controls counsel, CFIUS practitioners, and desk officers covering U.S.-China policy should monitor the annual January update, track concurrent NS-CMIC and Entity List actions, and assess whether covered counterparties have filed delisting petitions or APA challenges that may alter their status before the 2026 procurement bar takes effect.