On October 18, DJI, the leading Chinese drone manufacturer, filed a lawsuit against the U.S. Department of Defense after being placed on a blacklist that prohibits American investments in the company. DJI claims that the assertion linking them to collaboration with the Chinese military is incorrect and has resulted in significant financial losses.
As the world’s largest drone manufacturer, DJI accounts for over half of the commercial drone sales in the United States. In 2022, the Department of Defense added 13 Chinese companies, including DJI, to its blacklist, citing the need to counter China’s military-civil fusion strategy.
According to a report by Reuters on October 19, DJI stated it had no choice but to seek assistance from federal courts after 16 months of no communication from the Department of Defense regarding the blacklist.
In its lawsuit, DJI is requesting a court order to remove the company from the Department of Defense list, which categorizes it as a “Chinese military company.” DJI contends that it is “neither owned by nor controlled by the Chinese military.”
The lawsuit claims that the Department of Defense’s “illegal and misleading decision” has caused the company to lose business transactions, be stigmatized as a national security threat, and face prohibition from signing contracts with multiple federal government agencies.
The company also reported that both American and international clients have terminated existing contracts and refused to enter into new agreements with DJI.
As of now, there has been no response from the Department of Defense regarding requests for comment.
Additionally, a prior report from Reuters indicated that DJI informed its distributors that the U.S. Customs and Border Protection (CBP) had detained some of its drones due to alleged violations of the Uyghur Forced Labor Prevention Act (UFLPA), consequently halting their entry into the United States.
DJI emphasizes that more than half of the drones in the U.S. are produced by them and insists that their manufacturing processes do not involve forced labor. The company has stated that it is providing relevant documentation to U.S. Customs to demonstrate compliance with the UFLPA requirements.
