WIDE IMPACT EXPECTED
The new rule mirrors the “50 per cent rule” used by the U.S. Treasury Department for financial sanctions. It is expected to affect multiple sectors, including aircraft, semiconductors and medical equipment.
Chinese tech giant Huawei, video surveillance firm Hikvision and drone maker DJI are among those likely to face tighter constraints. Many of their subsidiaries are already blacklisted, but not all.
An analysis by U.S. data firm Kharon said the rule could bring thousands of hidden subsidiaries in nearly 100 countries into “export-control crosshairs,” including entities in Europe, Singapore, Japan, Canada and Australia.
GROWING LIST
The Entity List identifies companies deemed a risk to U.S. national security or foreign policy. There are now about 1,100 Chinese companies on the list, out of 3,400 globally, according to the Center for a New American Security.
Critics noted the move is not a “silver bullet,” as companies may restructure to avoid restrictions.
“The game of whack-a-mole will continue,” said Dan Fisher-Owens, a California-based trade lawyer.
Source: CNA
