China has announced sanctions on 10 American military-linked companies on June 22, calling it a direct response to the US government’s “wrongful expansion” of restrictions on Chinese tech firms. According to a report by news agency AP, the Commerce Ministry said Chinese companies will be prohibited from exporting dual-use goods and items with both civilian and military applications to the sanctioned firms. The list includes drone makers, defense contractors and rare earth companies such as AVEOX, Red Cat Holdings, Teal Drones, IMSAR, Jaia Robotics, Ball Aerospace, Oshkosh Defense, L3Harris Maritime Services, MP Materials, and USA Rare Earth. The ministry added that this move was aimed at safeguarding China’s national security and countering US restrictions.
Finance ministry adds procurement ban
Separately, China’s Finance Ministry barred government entities from purchasing products from 46 American companies, including units of Lockheed Martin, Raytheon, and General Dynamics. No reason was given, but analysts said the measure underscores Beijing’s intent to escalate pressure on U.S. defense-linked firms.
Response to US military company list
Earlier this month, the U.S. Defense Department added several Chinese tech giants, including Alibaba and Baidu, to its list of firms allegedly tied to the Chinese military. The designation prevents them from securing U.S. defense contracts. Baidu called the claim “totally baseless.” China’s Commerce Ministry said the American sanctions run counter to the consensus reached between Xi Jinping and Donald Trump during Trump’s May visit to Beijing.George Chen of The Asia Group said the sanctions were “unsurprising and proportionate,” noting that most of the targeted U.S. firms already have limited business exposure in China. “The impact will be quite symbolic,” he added, but the move signals Beijing’s readiness to retaliate in the ongoing tech and defense standoff.
What is US Entity List
According to Reuters, DeepSeek and over 100 other companies were approved last year for addition to the Entity List, a US trade blacklist that restricts access to American goods, software and technology. Companies placed on the list generally require special licenses to obtain US technology, and those licenses are often denied.Reuters reported that the Trump administration has held back publication of the new listings as it seeks to avoid escalating tensions with China.
US-China technology rivalry continues
Sources told the news agency that at least 75 Chinese entities involved in advanced semiconductor production, chip equipment manufacturing and AI model development had been approved for blacklisting but are still awaiting publication. The delay comes as Washington and Beijing remain locked in a broader rivalry over technology, trade and national security.Reuters reported that Commerce Department officials have become cautious about adding Chinese firms to the blacklist due to concerns that new restrictions could further increase tensions between the two countries.
