The Ministry of Commerce of China (MOFCOM) announced on 31 May 2019 that the Chinese government will introduce an “Unreliable Entity List” regime, under which foreign entities or individuals that boycott or cut off supplies to Chinese companies for non-commercial purposes and causing serious damages to Chinese companies would be listed as “Unreliable Entities”. The specific rules, including the list itself and the restrictive measures applicable to the listed entities, will be separately released in the near future. This new regime may be used by China as a countermeasure against export control measures of foreign governments targeting specific Chinese companies.Read more…
On 18 February 2017, China’s Ministry of Commerce and General Administration of Customs jointly issued Announcement  No. 12 (“Announcement No. 12“), imposing a blanket suspension on imports of coal produced in North Korea for the rest of the year. The suspension includes imports for which applications have been made, but not yet processed by Customs. Announcement No. 12 takes effect from 19 February 2017, and will be effective till 31 December 2017.
Announcement No. 12 is yet another implementation of the U.N. Security Council Resolution 2321 (2016), following various measures that have already been taken by China, including the ban on exports to North Korea of certain items connected to weapons of mass destruction.
Announcement No. 12 is a departure from China’s previous position, encapsulated in Announcement  No. 81 (“Announcement No. 81“). In Announcement No. 81, the Chinese authorities imposed certain restrictions on the import of coal from North Korea such as those related to North Korea’s nuclear programme. China had, in the past, taken the position that the importing of coal protected the livelihoods of the North Korean people.
While the Chinese authorities did not provide a reason for the imposition of the suspension, it is interesting to note that the Announcement came less than a week after North Korea’s latest missile tests. The latest missile launches were strongly condemned by the Security Council in a Press Statement released on 13 February 2017. In the Press Statement, the Security Council called on Member States to redouble their efforts to implement fully the measures imposed by the Security Council, including the measures contained in Resolution 2321 (2016).
What Companies Can Expect
As we have observed previously, further action from China could be expected if North Korea continues to defy the demands of the U.N. Security Council and the global community. This latest ban on imports of coal from North Korea is a strong warning from China that North Korea can expect swift retaliation if it continues with its missile tests or nuclear programme. With coal being a significant portion of China-North Korea trade, and China being one of North Korea’s top trading partners, it is likely that this ban would have a significant impact on North Korea’s economy.
China has banned exports to the Democratic People’s Republic of Korea (“DPRK”) of technology and materials that might be used in weapons production.
The new list of items banned for export to DPRK adds to a list of technologies and goods banned for export released in 2013 by the Commerce Ministry, the Ministry of Industry and Information Technology, and the China Atomic Energy Authority 2013 after DPRK had carried out its third nuclear test that year.
According to China’s Commerce Ministry, the list of banned “dual-use” items (i.e. products that have both a civilian and military use) now includes metal alloys, cutting and laser-welding equipment and materials, magnetic materials, high-strength metals, and chemical fibres.
The ban follows the latest nuclear test and rocket launch by DPRK on 6 January 2016 and 7 February 2016 respectively. These were followed by the unanimous adoption by the UN Security Council’s of Resolution 2270 (2016) (the “UN Resolution“) on 2 March 2016, and the adoption by the European Council of Regulation (EU) 2016/315 and Council Decision (CFSP) 2016/319 of 4 March 2016 (“he “March Decision”), which added 16 individuals and 12 entities to its list of designated persons (“DPs”). Please see our earlier blog post “UN, US, EU and Switzerland impose tough new sanctions on North Korea as a result of its nuclear programme” for further details on the March Decision.
The release of the list by China also follows the European Union’s implementation and extension of the UN Sanctions on DPRK in May 2016. Please see our earlier blog post “EU implements and extends UN Sanctions on North Korea” for further details on the EU’s latest amendment to the regulation underpinning its sanctions regime on DPRK.