A U.S. Congressional committee has asked the Commerce Department to investigate whether giant technology companies controlled by UAE families should be subject to trade restrictions because of their ties to China.
The company, G42, specializes in artificial intelligence and other emerging technologies and is overseen by Sheikh Tahnoun bin Zayed, the UAE’s national security adviser and brother of the country’s ruler.
The company recently signed deals with prominent US technology companies such as Microsoft, Dell, and OpenAI. Silicon Valley semiconductor company Cerebras is building his G42 supercomputer to develop and power AI products.
But the bipartisan House Select Committee on the Communist Party of China, in a letter sent Wednesday to the Commerce Department, said the company cooperated extensively with China’s “military, intelligence, and state-run entities,” according to a copy obtained by The New York Times. He said that times. The letter was signed by the committee’s chairman, Rep. Mike Gallagher (R-Wis.).
Biden administration officials have privately expressed similar concerns about the company, worrying that it could become a conduit for advanced U.S. technology to be siphoned off to Chinese companies and governments, The New York Times reported. The paper reported in November.
Emirates is increasingly seeking military and economic cooperation with China, even though it is a partner of the United States and one of the largest buyers of American weapons. This has raised concerns among U.S. officials who frequently visit small Persian Gulf states to discuss security issues. On Monday, Secretary of State Antony J. Blinken met with Emirati Emir Sheikh Mohammed bin Zayed in Abu Dhabi during a regional tour focused on the Israel-Gaza war, and the two sides emphasized the “importance of a strategic partnership.” ”, the State Department said.
A parliamentary committee reviewed documents showing that G42 CEO Peng Xiao “operates and is affiliated with an extensive network of companies that substantially support” China’s military’s technological advances and human rights abuses. announced.
The committee asked the Commerce Department to consider imposing export restrictions on the G42 and 13 companies, most of which are based in China, that the G42 owns or is affiliated with.
The regulation would prohibit U.S. companies from selling products to Emirati or Chinese companies without a license issued by the ministry. The committee said it has given the Commerce Department until Feb. 2 to take action or explain to lawmakers why it won’t.
Five of the Chinese companies are affiliated with Dark Matter, an Emirati company that has developed spyware and surveillance tools, the commission said. The letter does not say exactly how the Chinese affiliate, also known as Dark Matter, is connected to the Emirati company.
The CIA has a secret profile of Mr. Hsiao. He was born in China, attended college and graduate school in the United States, and then worked for the Virginia technology company MicroStrategy, which he left in 2014, according to public documents and reports. At one point, he obtained US citizenship, but gave it up in favor of Emirati citizenship. A G42 representative confirmed that his Chinese name is “Xiao Li”, and his name is listed on the website of the Chinese embassy in the Emirates.
A spokeswoman for the commission declined to disclose the documents it had reviewed.
“We have received the letter and will respond through appropriate channels,” a Commerce Department spokesperson said in a statement.
Representatives for the G42 did not respond to emails seeking comment.
A Times investigation found that U.S. intelligence officials had raised concerns about the company’s ties to China in a series of classified assessments. The report also said senior Biden administration officials pressured Emirati authorities to sever the company’s ties with China.
Those relationships include a partnership with Chinese telecom giant Huawei, which is under U.S. government sanctions, and BGI Genomics, whose companies were placed on a restricted list by the Commerce Department last March. Some U.S. officials have said they are concerned that the G42 is helping BGI seek to collect genomic data on Americans and millions of people around the world. .
G42 invested $100 million in TikTok’s Chinese parent company ByteDance last year and has invested in other Chinese companies. The company’s $10 billion investment fund 42X has a Shanghai office whose new head is Jason Hu, a former executive at China’s major e-commerce company JD.com.
The Biden administration enacted trade policies to prevent China from acquiring advanced chips and other tools that would allow it to overtake the United States in developing emerging technologies such as AI and quantum computing.
When the Times contacted G42 for a November article about the administration’s concerns, company executive Talal Al Qaisi said the company was working to “remain fully compliant” with U.S. government regulations. Stated. He added that the company is in talks with U.S. companies to replace its technology infrastructure, including hardware made in China.
“The trend lines of where the UAE is heading in its natural relationship with China are rapidly heading in the wrong direction,” Gallagher said in a press briefing on Nov. 29 after the article was published. ” he said.
G42 has received investment from Emirati sovereign wealth fund Mubadala and US private equity firm Silver Lake.
G42 declined multiple requests from the Times for an interview with Hsiao. The Financial Times published an interview with Hsiao on December 7 in which he said the G42 is moving to cut ties with Chinese hardware suppliers such as Huawei in favor of US companies. said.
However, the G42 is closely intertwined with Chinese businessmen and companies. Wire China reported last month that Zhang Xiaoping, G42’s chief investment officer, was also the chief operating officer of Chinese company Yitu Technology, according to company records. The Biden administration added Itu to its 2021 sanctions list for developing surveillance technology used by Chinese authorities to oppress Muslim Uyghurs.
Mr. Zhang runs two G42 companies in China, G42 Shanghai Investment and Beijing Qingzi Future Network Technology.
Additionally, the report said that Li Xiaoxu, the general manager of the company in Beijing, is also the supervisor of Pegasus Technology China. Pegasus Technology China was founded in 2015 by Emirati company Pegasus, where Mr. Xiao served as chief executive officer before being appointed to the same role. In G42.
All three Chinese companies were among 13 companies warned by a parliamentary committee.
In 2019, a company in the United Arab Emirates led by Mr. Xiao was involved in launching and operating the social media app ToTok. US intelligence agencies have assessed the app as a spying tool used by the United Arab Emirates government to track users’ conversations. According to an assessment by U.S. intelligence agencies, the data collected from the app was stored by an Emirati company run by Mr. Xiao called Pax AI.
Chinese engineers helped create the app, and forensic researchers who examined it in 2019 told the Times that it appears to be a copy of YeeCall, a Chinese messaging app that offers free video calls, and that it appears to be a copy of YeeCall, an English- and Arabic-speaking He said it was slightly customized for his audience. .
The Congressional letter named YeeCall as one of the companies that should be scrutinized by the Commerce Department.
Regarding dark matter companies linked to G42 and Peng, the letter said the network was working with Song Chun Zhu, a senior researcher at the Beijing Institute of Artificial Intelligence, a top state-backed scientific institution. states.
One of the Emirates-based companies owned by G42 and named in the parliamentary letter is Presight AI, which sells surveillance technology to police companies around the world. In March 2023, a New York Times reporter examined exhibits at a police conference in Dubai and found signs of close ties to China.
The company promoted itself as a kind of Emirati version of the US data company Palantir. A video display featured a version that showed off the company’s ability to thwart a drone attack on an office tower using big data analytics. Another demonstration showcased the company’s physical surveillance capabilities. The software platform used cameras and facial recognition technology to track conference attendees.
The software was loaded in Chinese before being translated into English and had many of the characteristics of Chinese police software. Company representatives claimed that the product was manufactured within the Emirates, but it has many features specific to the Chinese market, such as internet cafe surveillance and a special label for phone tracking not often seen outside of China. I was prepared.
A representative from Precyte AI, who attended the police briefing, said the surveillance software has already been sold to many countries in Africa and the Middle East, and is also used by the Emirati government.