On Monday, Gov. Greg Abbott (R-Texas) ordered a sweeping ban on the use of Chinese-linked technology by state employees.
Texas Expands Ban On Chinese Tech Over Privacy Risks
In a statement, Abbott said that Texas state employees are prohibited from using products and services from companies including Shein, Temu, Alibaba Group Holdings (NYSE:BABA) and TP-Link on state-owned devices and networks.
The reason cited is concerns that the Chinese government could gain access to sensitive data.
The restriction applies to physical hardware, software and artificial intelligence tools.
The governor said the move is aimed at protecting the privacy of Texans and preventing foreign adversaries from exploiting government systems.
Dozens Of Chinese Companies Added To Prohibited List
The expanded list includes a wide range of Chinese technology firms spanning e-commerce, telecommunications, artificial intelligence, surveillance equipment and energy storage.
Among them are battery maker CATL, drone manufacturer Autel, AI companies such as iFlyTek, SenseTime and Baidu Inc. (NASDAQ:BIDU) and electronics makers Xiaomi Corporation (OTC:XIACF) (OTC:XIACY), Hisense and TCL (OTC:TCLHF).
Texas officials also added Temu parent PDD Holdings (NASDAQ:PDD), fashion retailer Shein, networking company TP-Link and several AI research organizations and LiDAR technology firms.
Cybersecurity Agency Led Threat Assessment
The decision followed a threat assessment conducted by the Texas Cyber Command, or TXCC, which Abbott established in June.
The governor has described the agency as the largest state-based cybersecurity department in the country, tasked with coordinating efforts to counter cyber threats targeting Texas infrastructure.
Move Comes Amid Easing US–China Tensions
The Texas action comes even as the U.S. and China reached a limited detente last year in their long-running trade and technology dispute.
Abbott, a vocal supporter of former President Donald Trump, has taken a more aggressive state-level approach to restricting Chinese technology.
The ban applies only to state employees and government systems and does not affect personal use by Texas residents.
TikTok Secures US Future with American-Led Venture
Last week, ByteDance confirmed the establishment of TikTok USDS Joint Venture LLC, a new entity that will manage U.S. user data, the app, and its recommendation algorithm, effectively averting a nationwide ban affecting more than 200 million Americans.
The move comes after years of scrutiny dating back to 2020, when Trump sought to ban TikTok over national security risks tied to its Chinese ownership.
A 2024 law later required ByteDance to divest U.S. assets or face a ban, a measure upheld by the Supreme Court.
Under the agreement, American and global investors will hold 80.1% of the venture, while ByteDance retains a 19.9% minority stake.
Oracle Corp (NYSE:ORCL), Silver Lake and Abu Dhabi-based MGX each own 15% and will serve as managing investors.
Price Action: Alibaba shares declined 1.07% on Monday, Baidu shares decreased by 3.32% and PDD Holdings gained 0.44%, according to Benzinga Pro.
Alibaba stock scores high on Momentum in Benzinga’s Edge Stock Rankings, with a favorable price trend in the short, medium and long terms.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Photo Courtesy: Westlight on Shutterstock.com
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