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Do CCP-Controlled Small Businesses in the US Pose a Strategic Threat?

by | Jun 28, 2025 | Top Ten

Some Chinese corporations and even small businesses and organizations are known to be influenced or directed by the Chinese Communist Party.
Do CCP-Controlled Small Businesses in the US Pose a Strategic Threat?U.S. policymakers and national security experts have raised alarms about Chinese Communist Party (CCP) influence in the United States. That dangerous influence ranges from university laboratories to Wall Street, Silicon Valley, and Hollywood.
More recently, the focus has also expanded to large corporations. Chinese companies such as Huawei, Tencent, and others that operate in the United States and other Western nations may have built-in spyware of one sort or another in their technology and have a global reach. That, too, has been acknowledged by many nations, which is why they have ceased using Chinese routers and other advanced hardware and software.

Thousands of Chinese-Owned Companies in the US

The CCP’s penetration into and throughout American institutions has been well-documented for years and is widely understood. But it doesn’t end there.

For instance, about 5,000 companies operating in the United States are owned by Chinese nationals, and many are small businesses. Could they be a threat as well?
According to former FBI Director Christopher Wray, in his testimony before Congress in 2024, the answer is yes.

First, it’s important to note that not all or even most of the Chinese-owned businesses in the United States are CCP-controlled. Therefore, they do not or are unlikely to pose a threat. That said, CCP-controlled small businesses in the United States pose strategic threats to the country.

The CCP’s Party Cells in Small Businesses

To evaluate the risks involved, it’s important to understand how the CCP interacts with businesses.

In China, the line between private enterprise and state control is blurry at best. Even “private” companies are required to cooperate with state intelligence services when requested. This includes providing access to data, facilitating surveillance, or cooperating to meet national goals, which could have a rather broad definition.

Moreover, the CCP often installs Party cells inside companies, including tech startups, to maintain ideological control and strategic oversight. When such companies invest in or operate subsidiaries in the United States, concerns naturally arise, especially when it comes to sensitive data, emerging technologies, or infrastructure.

Not surprisingly, many small businesses that operate under direct or indirect CCP influence are in the technology, biotech, logistics, and data infrastructure sectors. These companies may have a Chinese parent enterprise linked to the CCP with access to U.S. data or intellectual property, or have a strategic role in critical infrastructure or supply chains.

All of these kinds of businesses may have access to key tech intellectual property, be in a position to observe sensitive military movements around military bases, or steal genomic data, which occurred during the COVID-19 era.

The List Is Growing

According to several federal agencies, the list of CCP-influenced companies is growing.

The FBI and Department of Justice are well aware of the Chinese regime’s comprehensive approach to economic and industrial espionage. Their concerns extend to small, under-the-radar businesses that typically include tech or AI startups and logistics and biotech companies.

There may be other CCP connections as well. For example, small businesses may be owned and run by CCP members living in the United States comfortably, along with investors who are Party members.

I know of at least one such company because I provided marketing services to the owner. Near the end of my work, he proudly announced that he was a Party member, where he lived, and who his investors were–CCP members “back in China.” Given that the company lost money year after year, but kept gaining U.S. manufacturing customers, intending to gain tech secrets through working with small subcontractors, while receiving cash infusions from back home, I found no reason to doubt his claim.

National Security Risks Are Now Being Studied

The fact is that CCP-controlled small businesses in the United States do indeed present potential national security and data privacy concerns, especially in sensitive sectors. While not all such businesses are dangerous, the nature of CCP influence combined with China’s global intelligence ambitions means that even small enterprises can be used strategically.

Even small organizations or local news outlets at the local or community level can and are being leveraged by the CCP for soft power purposes. That may include publishing or otherwise spreading positive viewpoints on China, negative viewpoints regarding U.S. policies toward China, or even suppressing anti-CCP dissent in the United States. By these means and others, CCP-influenced small businesses and organizations can impact Americans’ outlooks and political opinions.

The Need for Balance and Precision

The real issue isn’t Chinese ownership per se, but rather, the CCP’s control over specific companies and what it means to U.S. national security. The Trump administration’s policy should focus on distinguishing between business owners of Chinese descent who behave lawfully and contribute to American life and those who do the bidding of the CCP.

That requires intelligence, transparency, and better tools to strengthen oversight and focus on facts. Doing so will protect national security and the values of openness, fairness, and economic opportunity that define the American system.

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