Washington, D.C. – A U.S. House committee focused on national security has issued subpoenas to JPMorgan Chase and Bank of America, demanding documents related to their involvement in the recent $5.2 billion initial public offering (IPO) of Chinese battery giant Contemporary Amperex Technology Co. Ltd. (CATL). The move escalates a broader congressional effort to scrutinize American financial institutions' dealings with companies allegedly tied to Beijing's military and human rights abuses. According to a tweet from The Wall Street Journal, the subpoenas were issued to "produce documents related to their roles in a Chinese battery giant’s initial public offering."
The House Select Committee on the Chinese Communist Party, chaired by Representative John Moolenaar, had previously urged both banks in April to withdraw from underwriting CATL's Hong Kong IPO. The committee cited CATL's designation by the U.S. Department of Defense as a "Chinese military company" and alleged ties to the Xinjiang Production and Construction Corps (XPCC), an entity implicated in forced labor and human rights abuses against Uyghur Muslims. Chairman Moolenaar stated that the banks' involvement risked "complicity in underwriting genocide, undermining American industry and endangering U.S. national security."
Despite these warnings, JPMorgan and Bank of America proceeded with the IPO in May, which successfully raised $5.2 billion. CATL, the world's largest electric vehicle battery manufacturer and a key supplier to companies like Tesla, has denied any military ties or having suppliers from the Xinjiang region. Its shares reportedly soared 12.5% on their Hong Kong trading debut, marking it as a significant listing for the year.
The committee's concerns also extend to CATL's alleged role in modernizing China's military capabilities, specifically through its advanced lithium-ion batteries potentially powering China's submarine fleet. A representative for Bank of America stated the bank would continue to engage constructively with the committee following the subpoena. JPMorgan Chase declined to comment on the matter, though CEO Jamie Dimon had previously defended the bank's due diligence processes in such deals, noting that the U.S. had not sanctioned the Chinese battery maker.
This congressional action underscores growing tensions between Washington and Beijing over economic and national security issues. The subpoenas aim to uncover the banks' risk assessments and compliance protocols regarding their engagement with companies on the Pentagon's military list. The outcome could set a precedent for how U.S. financial institutions navigate investments involving Chinese entities facing national security scrutiny.