China EU sanctions dispute puts 14 European entities under export controls
Beijing barred dual-use exports to 14 European entities after the EU sanctioned Chinese and Hong Kong firms over Russia.
By Daniel Okafor · Business Editor
2 min read
The China EU sanctions dispute widened Friday as Beijing added 14 European entities to an export control list in response to the European Union’s latest Russia sanctions. China’s Commerce Ministry said Chinese companies may no longer export dual-use items to the listed organizations, a restriction that also reaches some foreign suppliers.
The ministry said foreign companies are barred from providing the 14 entities with dual-use items made in China. Dual-use items are products or technologies that can serve civilian purposes but may also be used for military activity.
The European organizations named by China include Czech vehicle maker Tatra Trucks, Italian electric motor manufacturer Lafert SpA, German manufacturer Sindlhauser Materials GmbH and French drone maker Cavok UAS. China’s Commerce Ministry did not name the other entities in the statement described Friday.
Why did China target European companies?
A spokesperson for China’s Commerce Ministry said the controls were imposed after the EU on Thursday added 14 mainland Chinese and Hong Kong enterprises to its newest sanctions package related to Russia’s war in Ukraine. The spokesperson described Beijing’s action as a response to the EU’s “egregious actions.”
The spokesperson said the measures were intended to protect China’s national security and interests and to meet international obligations, including non-proliferation commitments. Beijing framed the decision as retaliation for the EU action, rather than as a stand-alone trade measure.
The EU adopted its 21st sanctions package against Russia on Thursday. The package targeted banks, cryptocurrency companies and military equipment manufacturers, among other categories, according to the EU action described in the announcement.
The EU measures also included entities from countries outside Russia, including China, India and Turkey. Those entities were believed to be providing Russia with dual-use goods and technology, according to the sanctions action.
The exchange adds trade restrictions to a broader sanctions fight tied to the war in Ukraine. For affected companies, the immediate issue is access to Chinese-made dual-use goods and technology, because Beijing’s controls apply both to Chinese exporters and to foreign companies supplying those items from China.
This story draws on original reporting from Fortune.