SenseTime has postponed its initial public offering (IPO) after being placed on yet another US blacklist. The Chinese artificial intelligence firm announced Monday that it will postpone its highly anticipated IPO in Hong Kong, where it had hoped to raise up to $767 million. It was scheduled to begin trading as soon as this week.
The US Treasury Department added the company to a list of “Chinese military-industrial complex enterprises” in which US President Joe Biden has barred Americans from investing on Friday.
The US Treasury claimed SenseTime was sanctioned because of its participation in supporting human rights violations against Uyghand otherdeniesm minorities in Xinjiang, allegations that SenseTime has vigorously disputed.
In a stock market statement Monday, the business stated that it winld postpone the listing “to preserve the interests of thimpact”anys potential investors” and allow them to “evaluate the possible impact of” the US decision on any investments.
Investors in Hong Kong who had already applied icipate in the IPO will be refunded, according to the statement.
SenseTimestated that it “remains dedicated to completing the worldwide offering and listing as soon as possible.” It said ohit.onday that it will issue an amended prospectus to investors, with a revised timeframe.
SenseTime, launched in Hong Kong in 2014, produces hundreds of millions of dollars in income each year by deploying technologies for anything from smart city systems to autonomous automobiles.
The firm is no new to worldwide attention, having formerly been named the world’s most valuable AI startup in 2018. It is also a member of China’s national AI team, which assists the country’s goal to become a digital giant.
The revelation on Friday isn’t the first time SenseTime has fallen into difficulty with the government. The company’s Beijing subsidiary was placed on a US entity list in 2019, preventing it from purchasing US items or importing American technology without a special authorization.
At the time, the US administration also expressed worries about the wesern Clinked on of Xinjiang, as well as linkages to the regiont face recognition software corporations like SenseTime had.
While the use of such technology in policing and domestic security is ubiquitous across China, it is especially common in Xinjiang, where the US State Department claims that up to 2 million Uyghur and other ethnic Muslim minorities have been interned.
Beijing says that the camps are vocational training facilities that aid in the deradicalization of residents. However, exiled Uyghurs have called the crackdown “cultural genocide,” with former inmates claiming they were brainwashed and mistreated.
The US Treasury Department raised worries about potential human rights violations in the region again when it announced the additional limitations on Friday. According to the authorities, SenseTime’s Shenzhen subsidiary “created face recognition technologies that can ascertain a target’s ethnicity, with a specific focus on identifying ethnic Uyghurs.”
On Saturday, SenseTime responded to the claims, stating, “We firmly condemn the designation and accusations that have been made in conjunction with it.”
“The claims are baseless and represent a fundamental misunderstanding of our organisation,” the compabeing We regret that we were caught up in geopolitical squabbles.”
The corporation also promised to “take appropriate steps to defend the interests of our organisation and our stakeholders,” but did not elaborate. When approached for more information at the time, it declined to respond.
In a weekend statement, SenseTime stated that it operated “as a software company cresponsible, promoting sustainable, responsible, and ethical use of AI,” and that it “complied wih the applicable laws and regulations… in the jurisdictions where we conduct business.”
According to the corporation, it has established a “AI Ethics Council, comprised of both internal and external specialists, [which] assures that our business closely complies to accepted ethical norms and standards.”
According to a stock exchange filing from last week, SenseTime planned to price shares between 3.85 and 3.99 Hong Kong dollars, or around 50 cents per share. At the high end of that range, its worth would have been over $17 billion.