EU Reduces Sanctioned Chinese Companies from 8 to 3... Signs of Pressure Easing

Sanctions Imposed on Chinese Companies for Circumventing Russia Sanctions
Accused of Reselling Electronic Products Used in War Weapons

The scope of European Union (EU) sanctions against Chinese companies suspected of aiding Russia during the Ukraine war is expected to be significantly reduced. This follows an agreement by the companies to halt the resale of products that could be used for military purposes, and appears to have been influenced by opposition from some EU member states to increased pressure on China.

On the 15th, Hong Kong's South China Morning Post (SCMP), citing multiple diplomats and officials, reported that only three companies remain on the EU's sanctions list targeting Chinese firms. This is a sharp decrease from the previously known eight companies. Detailed information about the companies still under sanctions has not been disclosed.

[Image source=Yonhap News]

Previously, the EU had considered sanctions on two mainland Chinese companies, 3HC Semiconductor and KingPai Technology, as well as six Hong Kong-based companies including Sino Electronics, Sigma Technology, and Asia Pacific Links, as part of the 11th round of sanctions against Russia. This was a de facto secondary boycott (third-party sanctions) strategy in response to China's involvement weakening Western sanctions on Russia.

The companies in question are suspected of reselling electronic products used in weapons such as cruise missiles to Russia. According to the European Commission's sanctions proposal, 3HC Semiconductor, which manufactures computer chips, is suspected of circumventing export controls to Russia while procuring U.S.-made components to support the Russian military and defense industry. KingPai Technology is alleged to have provided ultra-small electronic technology for the development of defense programs used in the guidance systems of Russian cruise missiles.

The EU's recent decision appears to be based on China's expressed willingness to cooperate with EU demands. SCMP reported, "After talks with Chinese diplomats in Brussels (Belgium), some companies were provisionally removed from the sanctions list," adding that "China has pledged to work to stop the resale of European-made semiconductors and other electronic products flowing into Russian war weapons."

Initially, within the EU, stronger measures such as trade bans against China, which acts as a sanction evasion route for Russia, were discussed. However, these plans were thwarted after Germany effectively opposed them, leading to adjustments targeting individual companies. The recent reduction in the number of targeted companies is also interpreted as a consideration of the impact on trade and relations with China.

The three companies remaining on the sanctions list are reportedly Russian firms operating in China. SCMP explained, "The list of sanctioned companies remains fluid, and additional companies may be added if Chinese firms continue to sell prohibited European products to Russian military buyers."

Earlier, Fu Cong, China's ambassador to the EU, criticized the EU for attempting to sanction Chinese companies without presenting evidence that they supply products to Russia. He stated, "If the EU provides evidence, we will assist in stopping the companies. However, if Chinese companies are sanctioned without evidence, we will definitely retaliate."

Meanwhile, the approval of all 27 member states is required to finalize the implementation of the 11th round of sanctions. The amendment currently under review by the European Commission reportedly includes dozens of Russian companies including the defense firm Rostec, eight Iranian companies, and firms from Uzbekistan, Syria, Armenia, and the United Arab Emirates among the sanction targets.

This content was produced with the assistance of AI translation services.