Following months of negotiations and feints, on November 1, 2025, the United States and China reached a trade and economic agreement during bilateral discussions held in the Republic of Korea. The agreement outlines a series of reciprocal measures intended to address trade flows and market access between the two countries. The negotiations had already yielded significant rapprochement between the two countries, including the one-year suspension, as of November 10, 2025, of the “Affiliates Rule,” which imposes licensing requirements under the Export Administration Regulations on affiliates that are majority-owned by entities that appear on various export control/sanctions lists.
Following the agreement, the White House released a fact sheet outlining the key terms of the agreement, while China’s Ministry of Commerce (MOFCOM) issued a high-level statement in response to press enquiries. While significant details remain to be determined as the countries continue to negotiate and implement the agreement’s provisions, this alert summarize the key aspects of the deal as set out by the White House fact sheet and subsequent presidential actions.
As part of the agreement, China will suspend the global implementation of export controls it had announced on October 9, 2025. In lieu of these controls, China will issue general licenses for exports of rare earths, gallium, germanium, antimony and graphite, reversing controls imposed in April 2025 and October 2022. China also committed to halting the flow of fentanyl precursors to the United States by stopping shipments of designated chemicals to North America and controlling exports of other chemicals globally.
China will also suspend retaliatory tariffs announced March 4, 2025, which had affected a wide range of US agricultural products. Additionally, non-tariff countermeasures will be removed, including the delisting of US companies from China’s end user and unreliable entity lists. China also agreed to resume purchases of US sorghum and hardwood logs and to purchase at least 12 million metric tons of US soybeans in the final two months of 2025, with annual purchases of at least 25 million metric tons from 2026 through 2028. Other measures include: removing retaliatory actions related to the US Section 301 investigation into China’s maritime, logistics and shipbuilding sectors; extending market-based tariff exclusion process for US imports through the end of 2026; and terminating investigations targeting US companies in the semiconductor supply chain.
In return, the United States will reduce its “fentanyl” tariffs on Chinese imports by 10 percentage points, effective November 10, 2025. Following the announcement of the agreement, the White House issued an Executive Order implementing the agreed reductions to this tariff. It will also suspend heightened reciprocal tariffs until November 10, 2026, maintaining the current 10% rate, which was also memorialized in a subsequent Executive Order. Implementation of measures under the Section 301 investigation into China’s maritime and logistics sectors will also be suspended for a year, commencing November 10, 2025, while the United States and China pursue a negotiated settlement. The US will also suspend the interim final rule expanding end-user controls for one year.
The agreement offers a welcome reprieve for importers and other businesses who have spent much of the past year navigating the mercurial trade landscape. Businesses should continue to monitor developments pending the announcement of a final agreement and take actions to mitigate impacts on their operations:
- Review and update compliance processes in line with new export controls and tariff changes.
- Adjust supply chain strategies to benefit from lifted tariffs and renewed market access.
- Keep partners and stakeholders informed about changes to pricing, sourcing, and delivery.
- Track ongoing negotiations and policy updates to adapt business plans as needed.
- Update risk management strategies to address potential policy shifts.
- Consult industry groups and legal experts for guidance on the evolving US-China trade environment.
