Firm Building US Facility Confirms Parent Company’s Chinese Communist Party Ties Following DCNF Investigation

The president of a firm building a manufacturing facility near several Midwest military bases confirmed that his firm’s China-based parent company employs Chinese Communist Party (CCP) members and was previously involved in a military program during a state committee hearing on Monday.

The Chinese parent company of Cnano USA Inc. (Cnano USA) — which intends to build a facility in Kansas approximately 70 miles from Missouri’s Whiteman Air Force Base — employs dozens of CCP members and sold products to a Chinese university for its use in a Chinese military program, Shawn Montgomery, Cnano USA president, testified during a Kansas House Committee on Commerce, Labor and Economic Development hearing. The corporate records of Cnano USA’s China-based parent company, Cnano Jiangsu Technology Co., Ltd. (Cnano Jiangsu) state that the Chinese firm employs 28 CCP members and participated in the Chinese government’s so-called “863 Program,” which supports the development of China’s military, the DCNF recently reported based on research conducted by The Heritage Foundation Oversight Project and Heritage Action.

“I absolutely share the same concerns as all of you regarding foreign actors that could be a threat to our economy, our security, our safety and sincerely appreciate Kansas legislation’s effort to protect those fundamental interests,” Montgomery testified during Monday’s hearing concerning HB 2766, which, if adopted, will prohibit “foreign principals from countries of concern from holding any interest in certain real property in this state,” according to its text.

Kansas Republican state House Majority Leader Chris Croft told the DCNF that the bill will address constituent concerns regarding “CCP influence in our backyard.” However, Montgomery expressed “specific concerns” about the legislation during Monday’s hearing, citing the bill’s proposed 150-mile buffer zone around military installations.

Cnano USA is building an approximately $95 million manufacturing facility in Kansas because the state is “centrally located” and a U.S. facility will allow Cnano Jiangsu to avoid “costly trade tariffs,” according to Montgomery. The facility will produce carbon nanotubes that are “150,000 times smaller than the width of a human hair,” “highly conductive” and used in batteries and other products, he said.

Missouri Gov. Mike Parson issued an executive order in January 2024 banning entities tied to China from purchasing agricultural land within 10 miles of any “critical military facilities” in Missouri following the DCNF’s report. More recently, House and Senate Republicans led by Kansas Rep. Jake LaTurner and Missouri Rep. Mark Alford urged the Treasury Department and the Department of Defense to investigate Cnano USA, and Missouri Attorney General Andrew Bailey has also called on the Biden administration to restrict foreign land ownership near military bases such as Whiteman Air Force Base.

WATCH:

After Montgomery delivered his prepared remarks during Monday’s hearing, several Kansas state Republicans grilled the CEO about the CCP and Chinese military ties of Cnano Jiangsu and Cnano USA.

“Cnano Jiangsu operates a CCP Party branch with more than two dozen members and participates in CCP-backed initiatives including Project 863,” Kansas Republican state Rep. Patrick Penn said during the hearing. “For Project 863, which has sent money to the parent company, Cnano Jiangsu, it’s been a major CCP initiative to advance China’s military and civilian science technology, and according to a report from the Office of the Director of National Intelligence, it provides funding to clandestine acquirement of American technology and sensitive economic information.”

Penn then asked Montgomery whether or not Cnano Jiangsu employs CCP members.

“Cnano USA does not have any CCP members,” Montgomery said.

“The question was about your parent company, not USA,” Penn replied.

Montgomery went on to state that Cnano Jiangsu had “23 or 26 party members” and stated that U.S. companies like Ford and Walmart that operate in China also employ Party members.

Penn told the DCNF that, as a retired Army officer, he placed a premium on “clarity, national security and integrity.”

“We know that Cnano Jiangsu is calling the shots for Cnano USA when it is at the top of the chain of command,” Penn said. “These are legitimate concerns, only heightened by the fact that Montgomery refuses to directly address what we are actually asking.”

 

Rep. Patrick Penn questions Cnano USA's president Shawn Montgomery during the Kansas House Committee on Commerce, Labor, and Economic Development hearing on March 5, 2024. [Screenshot/YouTube/KSLegislature]

Rep. Patrick Penn questions Cnano USA’s president Shawn Montgomery during the Kansas House Committee on Commerce, Labor, and Economic Development hearing on March 5, 2024. [Screenshot/YouTube/KSLegislature]

During Monday’s hearing, Kansas state Rep. Kristey Williams then asked Montgomery about Cnano Jiangsu’s involvement in the Chinese government’s 863 Program and why the company had “scrubbed” references to the program from its website.

 

The 863 Program “focuses on both military and civilian science and technology” and aims “to accelerate the acquisition and development of science and technology in the PRC,” according to a report from the Select Committee of the United States House of Representatives.

“The 863 reference that was on there, I don’t know why it was taken down to be completely honest,” Montgomery told Williams. “Furthermore, I don’t even know why it was there to begin with.”

An archived version of Cnano Jiangsu’s website shows that it previously stated the firm had “undertaken a number of national 863” projects. Cnano Jiangsu removed references to the program less than a week after the DCNF’s December 2023 report.

Montgomery claims he asked Cnano Jiangsu about the 863 Program and was told that the firm had not had a “direct contract or project” with the program. Montgomery told Williams that it was his understanding that Cnano Jiangsu’s involvement was limited to selling carbon nanotubes to a Shanghai university participating in the program.

Montgomery also emphasized that Cnano Jiangsu sold the products to the Chinese university over a decade ago.

Williams told the DCNF that Montgomery’s testimony “provided no evidence or reliable assurances that Cnano works independently from the CCP.”

“Companies owned and operated by the CCP, whether in the U.S. or elsewhere, adhere to the policies, directions and goals of their authorizing entity – which is the CCP,” Williams said.

Majority Leader Croft also told the DCNF he didn’t think that Montgomery was providing “clear answers” to the committee’s questions.

“That should be a red flag for everyone,” Croft said.

Cnano USA, Cnano Jiangsu and Montgomery did not respond immediately to requests for comment.


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