Elon Musk’s aerospace giant SpaceX allows Chinese investors to buy stakes in the company through offshore secrecy hubs like the Cayman Islands.

Court records reveal that these investments are permitted as long as the funds are routed through such entities.

While SpaceX avoids direct Chinese investments due to its role as a US defense contractor, intermediaries like investor Iqbaljit Kahlon have facilitated such deals.

Kahlon testified that he raises funds from Chinese investors and channels them through offshore structures to acquire SpaceX shares.

The court case stems from a canceled 2021 deal in which a Chinese firm sought to buy US$50 million in SpaceX shares. Executives terminated the transaction after media coverage raised concerns about US national security scrutiny.

SpaceX chief financial officer Bret Johnsen admitted the company has no formal policy on foreign ownership but prefers to avoid investors linked to adversarial nations.

However, national security experts warn that using offshore entities could obscure foreign influence in a defense contractor handling sensitive technology.

Recent SpaceX developments