The US has decided to postpone adding DeepSeek and over 100 Chinese companies to its blacklist.

      The decision had essentially already been reached. As reported by Reuters, sources knowledgeable about the situation revealed that a US interagency committee had endorsed adding the Chinese AI startup DeepSeek, the memory-chip manufacturer CXMT, and over 100 other companies identified as national-security threats to the Commerce Department’s Entity List last year.

      However, what hasn't occurred, and is being reported for the first time, is the subsequent action: the Trump administration has delayed officially listing them, being cautious about escalating tensions with Beijing. The Entity List serves as a fundamental component of American export control; being placed on it acts as a soft blacklist, requiring US suppliers to obtain difficult-to-secure licenses before selling to listed companies. Typically, an interagency approval precedes the listing instead of serving as its replacement. The key issue here is that the panel approved over 100 companies, yet the listings have been stalled: the bureaucracy has reached its decision, but the politics haven’t endorsed it.

      The allegations against DeepSeek, as characterized by US officials, are clear-cut. A senior official at the State Department told Reuters last year that DeepSeek had aided China’s military and intelligence activities and attempted to utilize Southeast Asian shell companies to illegally procure advanced US chips.

      DeepSeek came to Western attention in January 2025, when a low-cost model challenged previous beliefs about the computational power required for a frontier system, making it a central figure in the China-AI security discourse since then. Security worries also encompass the operations of the model labs. Anthropic has mentioned identifying efforts by DeepSeek and two other Chinese labs to extract capabilities from its Claude platform to enhance their systems, while OpenAI has alerted lawmakers that DeepSeek was also targeting its models.

      These allegations of extraction and unlawful access, rather than legitimate competition, were part of the considerations of the interagency panel. However, diplomacy plays a crucial role as well. The administration is attempting to prevent relations with Beijing from worsening, and a blacklist encompassing over 100 firms would be perceived in China as a significant escalation.

      This situation highlights the ongoing tension in US-China tech policy, where security agencies wish to take action while trade negotiators seek space for diplomacy, a tension that TNW has monitored through various rounds of chip export controls. The situation with CXMT, the other mentioned company, adds to this dilemma. As one of China’s leading memory-chip manufacturers, it is pivotal to Beijing’s goal of semiconductor self-sufficiency, and placing it on the Entity List would constitute one of the more significant listings available to Washington.

      This sensitivity arises from the fact that the firms most desired to be restricted by security agencies are the ones whose listing would be deemed most provocative by Beijing. In essence, the delay is strongest where the argument for action is most compelling. For now, the listings remain uncertain: approved based on their merits, but withheld due to timing concerns. The companies continue to be absent from the formal blacklist not because the case against them is weak, but because the administration believes the moment to act has not yet arrived. When or if it does will offer more insight into the state of US-China relations than it will about DeepSeek.