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WASHINGTON (Reuters) - The United States added dozens of Chinese companies, including the country’s top chipmaker SMIC and Chinese drone manufacturer SZ DJI Technology Co Ltd, to a trade blacklist on Friday as U.S. President Donald Trump’s administration ratchets up tensions with China in his final weeks in office.
Reuters first reported the addition of SMIC and other companies earlier on Friday. The move is seen as the latest in Republican Trump’s efforts to burnish his tough-on-China image as part of lengthy fight between Washington and Beijing over trade and numerous economic issues.
The U.S. Commerce Department said the action against SMIC stems from Beijing’s efforts to harness civilian technologies for military purposes and evidence of activities between SMIC and Chinese military industrial companies of concern.
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The United States continues to tighten controls on the People’s Republic of China. In this article we address three regulatory changes that highlight the need for enhanced due diligence when dealing with China: 1) restrictions on recent additions to the Entity List; 2) controls on military end-uses and military end-users; and 3) elimination of Hong Kong as a separate destination under the Export Administration Regulations (EAR).
Entity List
On December 22, 2020, the Bureau of Industry and Security (BIS) added 59 Chinese entities to the Entity List, thereby expanding the licensing requirements on export transactions with these entities. See Notice at 85 Fed. Reg. 83416. The additions to the Entity List are the result of the collective determination by the Departments of Commerce, State, Defense, Energy, and where appropriate, the Treasury (collectively, the “End-User Review Committee”) that these entities are engagi
The United States added dozens of Chinese companies, including the country's top chipmaker SMIC and Chinese drone manufacturer SZ DJI Technology Co Ltd, to a trade blacklist on Friday as U.S. President Donald Trump's administration ratchets up tensions with China in his.
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On 18 December 2020, BIS added over 70 entities to the Entity List, including Semiconductor Manufacturing International Corporation (SMIC) of China. Most of these entities are subject to a presumption of denial for licenses for export, reexport or transfer of all items subject to the EAR, but the SMIC listing only applies a presumption of denial to items that are “uniquely required for production of semiconductors at advanced technology nodes (10 nanometers and below, including extreme ultraviolet technology)”, with a case by case review policy for all other items.
The Bureau of Industry and Security (“BIS”) in the U.S. Department of Commerce (“Commerce”) added more than 70 entities including Semiconductor Manufacturing International Corporation (SMIC) of China to the Entity List effective 18 December 2020. According to the BIS