The United States Enforces New Trade Restrictions on China

The United States posted amendments to the rules that enforce new restrictions on exports to China including components of civil aircraft and semiconductor-related products.

The new rules will require licenses to sell certain items to military entities in China even if they are for civilian use, and will eliminate a civilian exception that allows certain U.S. technology to be exported without a license if it is for a non-military entity.

The rules which were announced for public assessment and will be published in the Federal Register on Tuesday could affect the semiconductor industry and sales of civil aviation equipment to China.

Commerce Secretary Wilbur Ross said, “It is important to consider the ramifications of doing business with countries that have histories of diverting goods purchased from US companies for military applications.”

Washington trade lawyer Kevin Wolf said the rules are a reaction to China’s policy of seeking civilian products for military applications.

The regulatory military usage and consumer concepts are massive and go beyond purchases by organizations such as the People’s Liberation Army, he said.

“A military end-user is not limited to military organizations. A military end-user is also a civilian company whose actions are intended to support the operation of a military item,” he added.

The other law is expected to affect products such as an integrated circuit with field-programmable gate array, removing license exceptions for Chinese importers and Chinese nationals. Many products affected include some telecommunications devices, radar, and high-end computers.

The management also reported a third proposed amendment to the law that would require foreign companies shipping such American goods to China not only to receive approval from their governments but also from the United States.

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