US lawmakers accuse VC firms of funding Chinese military-linked firms

Sequoia Capital China, Qualcomm Ventures and three other venture capital firms plowed at least $3 billion into Chinese tech companies that support Beijing’s military and its repression of minorities in Xinjiang, a U.S. congressional report alleged on Thursday.
The House of Representatives’ select committee on China, led by Republican Congressman Mike Gallagher, released the report, which also scrutinizes investments made by GGV Capital, GSR Ventures and Walden International in Chinese artificial intelligence and semiconductor firms with unsavory ties.
The Committee called on the Biden administration to restrict U.S. investment in Chinese firms sanctioned by the U.S. government over ties to China’s military or its repression of minorities and urged it to bolster recent U.S. curbs on U.S. investment in China to include more sectors.
“The status quo is untenable… Decades of investment—including funding, knowledge transfer, and other intangible benefits—from U.S. VCs have helped build and strengthen the PRC’s priority sectors,” the report said.