Chinese SenseTime Postpones Hong Kong IPO After US Blacklist
Hong Kong (AFP) – Chinese artificial intelligence start-up SenseTime on Monday said it was postponing an initial public offering of $ 767 million in Hong Kong after it was blacklisted by the United States for human rights concerns in Xinjiang.
The US Treasury announced the ban on Friday, saying SenseTime’s facial recognition programs were in part designed to be used against Uyghurs and other predominantly Muslim minorities in Xinjiang, where UN experts and researchers believe. that more than a million people have been imprisoned in prison camps.
The blacklist immediately cast a shadow over the company’s upcoming Hong Kong IPO plans, which were due to take place a week later, and illustrated the risks investors face due to competing sanctions rules then. that relations between the world’s two largest economies have deteriorated.
On Monday, SenseTime filed a statement with the Hong Kong Stock Exchange saying it would postpone its listing “to protect the interests of potential investors” as they assess the impact of their blacklisting.
SenseTime said it “remains committed” to registering in Hong Kong soon and will fully refund those who have already invested.
U.S. sanctions and the blacklist can prevent individuals from obtaining visas for the United States, block assets under U.S. jurisdiction, and prevent targets from doing business with U.S. individuals or entities – excluding them from the U.S. American banking system.
A blacklist would make it virtually impossible for US investment banks typically involved in Hong Kong listings to be involved, or for a US national to invest in the offering.
Technology that identifies ethnicity
Washington says SenseTime is part of China’s “military-industrial complex”. He had previously blacklisted the company from the US Department of Commerce in 2019 because its technology had been used for mass surveillance in Xinjiang.
He says SenseTime has developed and deployed facial recognition software that can determine a person’s ethnicity, including whether someone looks Uyghur.
SenseTime sharply criticized the latest blacklist, saying in a statement over the weekend that it was “in the midst of geopolitical tensions.”
“We strongly oppose the designation and the accusations that have been made against it. The accusations are unfounded and reflect a fundamental misperception of our society,” the cabinet said.
The plight of the Uyghurs has helped worsen diplomatic relations between Western powers and Beijing.
Human rights groups and foreign governments have found evidence of what they say is mass detentions, forced labor, political indoctrination, torture and forced sterilization. Washington called it genocide.
After initially denying the existence of the Xinjiang camps, China later defended them as vocational training centers aimed at reducing the attractiveness of Islamic extremism.
Beijing’s use of technology to keep track of its citizens, and the companies pioneering such research, have come under increased international scrutiny in recent years.
China maintains large and sophisticated surveillance programs, both online and on the street, with artificial intelligence and facial recognition software playing a key role.
During the coronavirus pandemic, SenseTime’s software was used to check the temperatures of commuters, determine if they were wearing a face mask, and could also identify people when their mouths were covered.
Founded in 2014 by academic Tang Xiao’ou at the Chinese University of Hong Kong, the company has become in a few years one of the most valued start-ups in China.
© 2021 AFP