US Investigates Chinese Companies Over Export Sanction Issues

U.S. Commerce Secretary Gina Raimondo said on Tuesday the Biden administration is actively considering adding new Chinese companies to the government's economic blacklist as it investigates what it calls efforts by China to evade U.S. sanctions.

The Commerce Department's Entity List restricts access to U.S. exports.

Raimondo told reporters the administration was working to "get information around bad actors in China and adding those companies to the Entity List ... We are in the middle of a number of investigations."

She added: "I don't see us relaxing sanctions any time soon."

China is not standing still, she said. "They are coming up with, we know, new ways to evade our sanctions, setting up new [companies] and the like. We have a very aggressive and vigilant effort under way."

When possible, she said, she wants to work with U.S. allies to align their trade restrictions with U.S. export controls.

The Trump administration aggressively used the Entity List, adding dozens of Chinese companies including Huawei HWT.UL in 2019. It also added chipmaker SMIC 0981.HK and Chinese drone manufacturer DJI in 2020.

The Biden administration has extended that policy and in November put a dozen Chinese companies on the Entity List over national security and foreign policy concerns, in some cases citing their help in developing the Chinese military’s quantum computing efforts.

In December, Commerce added China's Academy of Military Medical Sciences and its 11 research institutes to the Entity List.

Raimondo cited a recent report that Apple Inc AAPL.O was considering moving some production out of China.

"I've heard that same thing from numerous other American manufacturing companies, many of whom have been manufacturing in China for decades," she said.

In February, the Commerce Department added 33 Chinese entities to its "unverified list" that requires U.S. exporters to go through more procedures before shipping goods to the entities.

China’s embassy in Washington said last year the United States "uses the catch-all concept of national security and abuses state power to suppress and restrict Chinese enterprises in all possible means."