Three Textile Enterprises Are Listed In The "Entity List". How To View The Expansion Of The US Ministry Of Commerce?

On July 20, the Bureau of industry and security (BIS) of the U.S. Department of Commerce announced the addition of 11 Chinese companies to the entity list.

Taiji Textile Co., Ltd. includes 3 textile and garment enterprises in Nanjing.

Changji Yida textile was founded by Yida group in 2009. Yida produces clothing for brands such as Ralph Lauren, Tommy Hilfiger and Hugo Boss. On April 24, 2020, the group issued a notice against forced labor overflow.

"Entity list" is an export control regulation established by the United States to safeguard its national security interests. U.S. exporters may not assist these listed businesses in obtaining any items subject to this regulation without obtaining a license.

The list of entities is a tool used by BIS to restrict the export, re export and (at home) transfer the goods subject to the export administration regulations (ear) to individuals (individuals, organizations, companies) that reasonably believe to involve or constitute significant risks, and engage in activities that violate the interests of the United States national security or foreign policy. Additional license requirements apply to exports, re exports, and (domestic) transfers of ear bound projects to listed entities, and the availability of most license exceptions is limited.

In short, "entity list" is a "blacklist". Once it enters the list, it actually deprives the relevant enterprises of trading opportunities in the United States.

As early as two months ago, on May 22, acsu Huafu Textile Co., Ltd., a subsidiary of Huafu, was listed in the entity list by the U.S. Department of Commerce. Huafu Fashion Co., Ltd. made an announcement on its official website for the first time on the list of entities listed by the US Department of Commerce.

In response to the decision of the U.S. Department of Commerce, Huafu fashion said that the company is one of the largest new yarn enterprises in the world. Its investment in Xinjiang is based on the advantages of high-quality cotton, energy prices, industrial workers and other resources, as well as the future opportunities for the belt and road to the West.

"Under the U.S. export administration regulations, transactions (including exports, re exports, and even domestic transfers) of ear controlled items between a listing entity and a U.S. exporter are restricted. Aksu Huafu serves the domestic market, and its raw materials, equipment and technology can avoid products originating in the United States, and being listed in the entity list will not affect its daily operation. Since its establishment, Aksu Huafu has been committed to not only being a capable enterprise, but also a good enterprise. It has faithfully performed its social responsibilities, abided by relevant laws and regulations, abided by the business conduct standards, and fully respected the rights of employees. " Huafu fashion said.

In fact, in the past year or so, the United States has expanded the "entity list" several times. On June 2, our newspaper also published an article "Huafu fashion subsidiary is listed in the entity list by the United States, experts suggest five aspects to do a good job in crisis management". Up to now, there are more than 100 universities and scientific research institutions in the United States. Some experts have predicted that with the escalation of Sino US trade war, the list will become longer and longer. Bai Ming, deputy director of the international market research department of the Institute of international trade and economic cooperation of the Ministry of Commerce, said: "the objects of the US ban are not only Chinese enterprises, but also industries. Don't think that the United States only targets at giants like Huawei. It is also conspiring to round up small and medium-sized enterprises with potential to become bigger and stronger and attack them collectively.".

Some lawyers have pointed out that: US enterprises are not allowed to conduct transactions in restricted areas with enterprises listed in the entity list, while entities outside the United States and entities in the entity list shall also comply with the trade rules of the United States if they meet the so-called "minimum us content standard" in the restricted areas, otherwise they will also face American suppliers“ The risk of "supply interruption". If an enterprise violates the provisions of the export administration regulations, it may be punished by the U.S. government. Such punishments mainly include issuing warning notices and imposing administrative fines (with the legal maximum penalty amount as the upper limit). If the circumstances are serious, criminal offenses will also be involved.

In addition, even if a customer is included in the "entity list" by the United States, it can continue to cooperate with such customers as long as the subject matter of the transaction is not within the restricted area, and is not affected by the entity list and export control.