The Chinese synthetic intelligence startup was supposed to cost shares Friday in its preliminary public providing in Hong Kong, the place it deliberate to boost as much as $767 million.
But its preparations to go public had been overshadowed by information that Washington was including SenseTime to a different buying and selling blacklist.
The US Treasury division confirmed Friday that it had determined to put the corporate on a listing of “Chinese military-industrial complex companies,” during which US President Joe Biden has banned Americans from investing.
The US Treasury mentioned SenseTime was sanctioned due to the function its expertise performs in enabling human rights abuses towards the Uyghurs and different Muslim minorities in Xinjiang.
“SenseTime … owns Shenzhen Sensetime Technology Co. Ltd., which has developed facial recognition programs that can determine a target’s ethnicity, with a particular focus on identifying ethnic Uyghurs,” the division mentioned in a press release. “When applying for patent applications, Shenzhen Sensetime Technology Co. Ltd. has highlighted its ability to identify Uyghurs wearing beards, sunglasses, and masks.”
SenseTime didn’t reply earlier to a request for touch upon that report.
The firm has beforehand mentioned that it has developed its “AI code of ethics to ensure our technologies are used in a responsible way,” and has mentioned that gross sales to prospects in Xinjiang have been in compliance with Chinese legislation.
The firm additionally claimed that “none of our material investors, customers or suppliers had withdrawn their investment or ceased doing business with us due to the Entity List addition.”
But it has acknowledged potential headwinds, saying that “we are subject to the risks associated with international trade policies, geopolitics and trade protection measures, and our business, financial condition and results of operations could be adversely affected.”
AI beneath scrutiny
But the agency is greatest recognized for its facial recognition software program, which has lengthy been topic to controversy.
In a press release on the time, SenseTime advised CNN Business that the reference to Uyghurs was “regrettable,” including that it was “one of the examples within the application intended to illustrate the attributes the algorithm recognizes.”
“It was neither designed nor intended in any way to discriminate, which is against our values,” a spokesperson mentioned. “We will update the patent at the next available opportunity.”
More not too long ago in its funding prospectus, SenseTime mentioned that its “previous sales to customers in Xinjiang were in compliance with” Chinese legal guidelines, and that revenue from these gross sales had been lower than 1% over the past three years.
SenseTime was as a result of begin buying and selling in Hong Kong on Friday, December 17.
— Brian Fung and Ben Westcott contributed to this report.