The War of the Lists and How It Could Affect Your Company

October 31, 2019

The US-China trade war has had global economic impact and has created anxiety for US and international companies operating in China and Chinese companies operating in the United States. Although not prominently reported compared to tariffs, the use of administrative powers and “blacklisting” has been a frequent and powerful tool of the US and Chinese governments.

Since the beginning of the Trump Administration, the US government has implemented several policies to increase pressure on China to open its markets, reduce intellectual property theft and create an even playing field in trade. These policies include tariffs on items such as steel, agriculture and consumer goods as well as use of legal and administrative tools such as congressional, criminal and civil investigations, including enforcement actions under the US export control laws, the US Export Administration Regulations (EAR) and US trade sanctions regulations administered by the US Treasury Department Office of Foreign Assets Control. For example, the US Department of Commerce Bureau of Industry and Security (BIS) has used the Entity List under the EAR to impose very restrictive US export licensing requirements on specified Chinese companies. The Chinese government responded to these policies in kind, enacting its own tariffs, trade and market restrictions, and other measures.

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