The U.S. Defense Department has added dozens of Chinese companies, including games and technology company Tencent, artificial intelligence firm SenseTime and the world’s biggest battery maker CATL, to a list of companies it says have ties to China’s military,

The U.S. Defense Department said on Monday it has added Chinese tech giant Tencent Holdings and battery maker CATL to a list of companies it says work with China's military, in a move set to escalate U.

Chinese internet giant Tencent’s shares slumped sharply on Tuesday after the company was added to a Pentagon blacklist for its alleged links with the Chinese military, prompting criticism from authorities in Beijing and denial by the company.

The US has added several Chinese technology companies, including gaming and social media giant Tencent and battery maker CATL, to a list of businesses it says work with China's military. The list serves as a warning to American companies and organisations about the risks of doing business with Chinese entities.

The gaming and social media group, which owns ubiquitous Chinese messaging app WeChat, was added to a list of dozens of companies the defence department considers to be working with the Chinese military directly or indirectly,

Tencent’s shares plunged nearly 10 percent after it was designated a military company. The Chinese battery manufacturer CATL was also added to the list.

Tencent Holdings Ltd. slid in US trading on Monday after the Defense Department designated the technology firm a Chinese military company operating in the US.