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Trade war: China unveils long-awaited ‘unreliable entities list’ rules

Beijing says firms on ‘unreliable entities list’ will be banned from trading with, investing in China

  • Commerce ministry releases details of blacklist that was announced in May last year

  • Any organisation or person investigated will have an opportunity to defend themselves, and be granted a grace period to correct any unacceptable behaviour, it says

More than 15 months after its announcement, China has finally released details of how its new “unreliable entities list” will work, in a move seen as a countermeasure to similar actions taken by the United States.

Beijing said in May 2019 it would blacklist foreign firms or individuals that violated market rules or contractual obligations, or took measures that hurt the rights of Chinese businesses or threatened China’s national security interests.

According to a statement issued by the commerce ministry on Saturday, firms and individuals on the blacklist would be restricted or banned entirely from trading – both imports and exports – with China and also from investing in the country.

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.

Joerg Wuttke, president of the European Union Chamber of Commerce in China, said the vagueness of the language used by the ministry left “plenty of room for discretionary actions”. Lu Xiang, a research fellow on US-China relations at the Chinese Academy of Social Sciences, said the release of the rules was a response to Washington’s efforts to contain Chinese technology companies and would allow Beijing to introduce countermeasures in the future.

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