US vs China

China implements sanctions against US companies

Move comes a day after the U.S. ordered a ban on downloads of TikTok and effectively blocked the use of WeChat.

Last updated:

China has implemented its “unreliable entities list” in retaliation against the U.S., which has used its own “entity list” to shut Huawei out of the U.S. market, while also attacking TikTok and WeChat.

An announcement by China’s Ministry of Commerce did not mention any specific foreign entities that could be targeted but it said the new system would consider sanctions on entities whose activities “harm China’s national sovereignty, security, and development interests” or violate “internationally accepted economic and trade rules.”

That language closely tracks wording that Beijing has used to repeatedly denounce U.S. actions against Chinese companies.

Foreign business communities have voiced concerns as to how the rules might be implemented in the highly politicised business environment created by the stand-off between Beijing and Washington.

The move appeared to signal China was ready to retaliate less than one day after the Trump administration said it would ban TikTok and WeChat from app stores, citing national security concerns.

As part of the Friday announcement, U.S. officials said WeChat, owned by the Shenzhen technology giant Tencent, and TikTok, which was under buyout talks with Oracle, would be removed from Apple’s and Android’s U.S. app stores at midnight when Sunday turns to Monday. Money transfers on WeChat, which is widely used for cross-border transactions with businesses in China, could also be cut off, but the ban is not expected to cover ordinary people using the app for communication.

On Saturday, the Chinese Commerce Ministry appeared to suggest that Apple and Google could be targeted if they complied with the U.S. government’s take-down order.

An office will be established to investigate and rule on cases of entities or individuals being suspected of breaking the new rules and any organisation or person that was investigated would be given the opportunity to defend themselves and also be granted a grace period to correct any unacceptable behaviour.

Firms already added to the list may be removed if they remedied their behaviour and took timely action to negate the consequences of their actions, it said.

In the event of a rule breach by an individual being confirmed, that person would be stripped of their work and residence permits, and could be denied access to the country. In some cases, fines would also be payable, the statement said, without elaborating.

In a statement, the ministry asked Washington to stop its “bullying” of WeChat and TikTok and “abandon its hegemonic behavior.”

“Without providing evidence, the United States has repeatedly used its national power to hunt and suppress the above two companies for unwarranted reasons, seriously disrupting the normal business activities of the companies and undermining the confidence of international investors in the U.S. investment environment,”.

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