On Monday, China issued a strong protest against the decision of the United States to broaden the export reduction catalog, and stated that it would implement the essential steps to protect the legitimate interests of Chinese companies.The United States implemented stricter checks on Monday aimed at companies in China and various countries that use subsidiaries to circumvent limitations of the production equipment of semiconductors and associated technologies.The Chinese Ministry of Trade has released a statement that Washington demanded to “immediately correct his unlawful action” and to strike his “unreasonable oppression of Chinese companies”.After us on Monday, it will be the limitations to companies in China and other countries that use subsidiaries to bypass existing curbs on chipping equipment and other technology. The Commerce department has issued a new rule that expanded its limited export list, known as the entity list, to automatically include subsidiaries that are 50 percent or more owned by a company that is already on the list, according to a placement in the US Federal Register. The relocation significantly increases the number of companies that need permits to receive American goods and services. The rule is expected to disrupt the supply chains and make the efforts of companies more complicated to determine whether the export to a customer or supplier is limited. Certain transactions can still be allowed for 60 days, noted the message, as reported by Reuters. The partners rule is modeled on the Office of Foreign Assiva check of the Treasury Department “50 percent rule” for sanctioned entities. According to the rule of the trade department: “If a company is 50 percent or more owned by an entity on the list, licenses are required for American exporters to send goods or technology to the subsidiary, just like for listed entities, with many licenses that are probably refused.”
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