China restricts exports to 10 US defense-linked firms
Beijing announced export curbs and procurement bans after Washington added Chinese tech companies to a defense-related blacklist.
By Daniel Okafor · Business Editor
3 min read
China said Monday it will restrict exports to 10 U.S. military-related companies, widening a tit-for-tat dispute over defense supply chains. The move matters because it targets goods with potential military uses and follows a U.S. decision to bar some major Chinese technology firms from Pentagon contracts.
China’s Commerce Ministry said Chinese companies may not sell “dual-use” items to the 10 U.S. firms. Dual-use products are goods that can be used for civilian purposes as well as military ones.
The ministry said the measures were intended to protect China’s national security. It also described the action as a response to what it called Washington’s “wrongful expansion” of a U.S. list of Chinese military companies.
The restrictions apply to companies including drone makers, defense suppliers and rare earth-related firms, according to the Commerce Ministry. The 10 named companies are:
- AVEOX, based in Simi Valley, California
- Red Cat Holdings, based in South Salt Lake, Utah
- Teal Drones, based in South Salt Lake, Utah
- IMSAR, based in Springville, Utah
- Jaia Robotics, based in Bristol, Rhode Island
- Ball Aerospace & Technologies, based in Broomfield, Colorado
- Oshkosh Defense, based in Oshkosh, Wisconsin
- L3Harris Maritime Services, based in Norfolk, Virginia
- MP Materials, based in Las Vegas
- USA Rare Earth, based in Stillwater, Oklahoma
The Commerce Ministry said the export limits also reach beyond China’s borders. Companies and individuals in third countries are barred from transferring Chinese-origin dual-use items to the sanctioned U.S. firms, the ministry said.
Chinese companies can seek official approval for exports deemed “genuinely necessary,” according to the ministry. The announcement did not say what standard officials would use to decide those requests.
China’s Finance Ministry announced a separate procurement measure on Monday. It said government entities may not buy products from 46 U.S. companies, including multiple units of Lockheed Martin, Raytheon and General Dynamics.
The Finance Ministry did not give a reason for that purchase ban in its brief statement. The two measures add to a series of actions by Beijing and Washington aimed at companies tied to defense, advanced technology and strategic materials.
The latest Chinese action follows a U.S. Defense Department decision earlier this month to add several Chinese technology firms, including Alibaba and Baidu, to a list of companies it says are linked to China’s military. That designation blocks the companies from receiving U.S. military contracts.
Baidu rejected the U.S. characterization, saying the suggestion that it is a military company is “totally baseless.”
China’s Commerce Ministry said at the time that the U.S. restrictions ran against the consensus reached by Chinese leader Xi Jinping and U.S. President Donald Trump during Trump’s May visit to China. Monday’s measures mark Beijing’s formal response to that U.S. defense-contract restriction.
This story draws on original reporting from NPR.