The national security regulations recently proposed by the Biden-Harris administration, as they stand, would give free rein to Gotion High-Tech, a Chinese government-linked company that is developing an electric vehicle battery factory just 63 miles from a sensitive military facility in northern Michigan.
Under the proposed rules, federal officials could more closely scrutinize foreign transactions within 100 miles of more than 50 additional military bases across the country, including the National Guard’s Camp Grayling in Crawford County, Michigan. But the rules will not take effect retroactively, allowing Gotion High-Tech and its subsidiary Gotion Inc. to escape further scrutiny.
American military personnel have trained Taiwanese soldiers as part of annual military exercises at Camp Grayling, the Wall Street Journal reported last year. The training activity increases the base’s awareness of nearby facilities operated by Chinese companies.
The Committee on Foreign Investment in the United States — a Treasury Department-overseen task force charged with reviewing foreign investments that could pose a national security threat — reviewed Gotion’s transaction but determined in June 2023 that it was not a covered real estate transaction or purchase. Less than two months after that determination, the company completed the purchase of 270 acres of land in Green Charter Township, Michigan, as part of its plan to build its $2.4 billion EV battery component plant in the area. Treasury Department rules proposed last month would likely make Gotion’s purchase a covered transaction.
“It is highly irregular and problematic that the Treasury Department is closely monitoring a ‘deal’ in Michigan with PRC-based and Chinese Communist Party-affiliated company Gotion. Camp Grayling would be included in the list of such facilities, but Gotion would be exempt from review even though the proposed location is within the expanded 100-mile range,” former U.S. ambassadors Joseph Cella and Peter Hoekstra said in a statement to the Free Washington Beacon.
“This is extremely concerning,” they continued. “Gotion may have secured an exemption or special treatment from the Treasury Department through its influential and well-connected lobbyists and legal team in Washington. This latest development is yet another example of how the PRC-based and CCP-affiliated company Gotion is engaged in an influence operation and all-out war.”
In the first half of 2024 alone, Gotion spent $2.7 million lobbying Congress, the Treasury Department and the White House on a range of issues including “foreign direct investment, trade and economic development,” according to federal government disclosures.
While Michigan state authorities under Democratic Governor Gretchen Whitmer have enthusiastically supported the project and provided hundreds of millions of dollars in subsidies, locals, security experts and lawmakers from both parties have expressed concern about Gotion’s ties to the Chinese Communist Party.
For example, Gotion High-Tech’s corporate charter states that the company is committed to “carrying out party activities in accordance with the Constitution of the Communist Party of China.” The company also hosted several corporate trips to revolutionary monuments of the Communist Party of China in Anhui Province, China in 2021. Daily Caller News Foundation first reported. During the trips, Gotion employees wore high-tech Red Army uniforms and vowed to “fight for communism until the end of their lives.”
Gotion Inc. is itself listed as a Chinese foreign principal in the most recent Foreign Agents Registration Act disclosures filed by the Free beacon. The disclosures were filed on May 30 by Warner Norcross + Judd, a law firm representing Gotion.
“Gotion Inc. voluntarily filed all required documents with the U.S. Department of the Treasury’s Committee on Foreign Investment in the US last year, and CFIUS determined that our proposed land purchase was not a covered transaction,” Gotion Vice President Chuck Thelen said in a statement. “Gotion then purchased the property and is now in the process of advancing all required site preparation and permitting processes.”
“To our knowledge, the rule change proposed by the Treasury Department would not be retroactive and would only apply to new land purchase proposals. Gotion welcomes and continues to encourage additional CFIUS reviews should it decide to purchase additional land in the future,” he added. “We remain transparent, accountable and excited about our planned battery component factory in Green Charter Township and will continue to comply with all laws and regulations in the jurisdictions in which we operate.”
The Finance Ministry did not respond to a request for comment.
Cella and Hoekstra — who have led efforts to target a wide range of factories with ties to China through their Michigan-China Economic and Security Review Group — filed comments with the Treasury Department this week pointing out Gotion’s ties to the Chinese government and urging the agency to close the legal loophole that gives the company free rein.
“If this rule becomes effective, we urge you to apply the rule’s language retroactively to Gotion and all other PRC-based and Chinese Communist Party-affiliated companies at a similar stage in their transactions that are within the 100-mile radius of CFIUS’s real estate jurisdiction,” they wrote in the filing filed with the company. Free Beacon.
“We call on the Treasury Department to join with the Department of Defense and Congress in recognizing the threat posed by Communist China and responding in coordination with them by providing for our common defense in a convergent and synchronized manner and not showing division within our government that would be a red flag to Communist China and further endanger our national security,” Cella and Hoekstra concluded. “We must never put money before country.”
