WASHINGTON, D.C. – Senator Jim Banks (R-Ind.) sent a letter to the Japanese Ambassador Shiego Yamada expressing concern about the Japanese Embassy’s involvement in TCL’s acquisition of Sony’s home entertainment business and the potential national security risks it may pose.
Read the full letter here or see full text below.
Dear Ambassador Yamada: I write regarding Sony Corporation’s announcement that Sony has signed a memorandum of understanding with the Chinese company TCL Electronics Holdings Limited, outlining an agreement in which TCL would hold a 51% stake in Sony’s home entertainment business.
This proposed transaction raises significant concerns for both Japanese and U.S. interests. Our countries share a vital strategic interest in maintaining resilient, trusted technology supply chains and in preventing foreign adversaries like China from expanding leverage over critical technology ecosystems. The display industry is becoming increasingly interconnected with national security interests, with applications in warfighting, defense systems, and other sensitive contexts. Concerningly, China already is the dominant player in the international display market, presenting a major vulnerability for Japan, the United States, and our allies across the globe. Commercial display devices also pose serious risks: modern home entertainment products are networked computing platforms that often connect to other devices (e.g., phones, devices, apps) and collect sensitive user data.
These security threats are exacerbated by ties between TCL and the Chinese Communist Party (CCP). TCL’s website highlights that its founder and chairman has served in several key roles in throughout the PRC party-state, including as a delegate to the 16th Party Congress, as a representative of numerous National People’s Congresses, and as the Vice Chairman of the All-China Federation of Industry and Commerce, a United Front-affiliated organization. These positions are fully consistent with the CCP’s broader strategy of co-opting private industry to suit the Party’s interests, especially in critical technology sectors.
For these reasons, I respectfully request a rigorous review under Japan’s foreign investment screening framework. Under the Foreign Exchange and Foreign Trade Act (FEFTA), the Ministry of Finance has the ability to review, modify, or block investments in Japanese companies that operate in designated business sectors.
Therefore, I respectfully request that the Government of Japan:
- Clarify whether the contemplated deal between Sony and TCL triggers FEFTA prior-notification and screening.
- Conduct a full economic and national security risk assessment addressing technology transfer threats, software/firmware considerations, and data governance practices associated with smart features and connected services.
- Use FEFTA authorities, as appropriate, to protect national security interests, including by blocking the proposed transaction if necessary, consistent with Japan’s screening framework and procedures.
Japan and the United States have an opportunity to work together to address risks posed by CCP dominance in critical technology sectors. I appreciate your attention to this matter and welcome opportunities to further engage to advance our shared interests.
