US Sanctions Chinese, Pakistani Companies Over Military Links

Chinese, Russian, Iranian, Pakistani, and Burmese troops launch rockets from missile systems during the "Caucasus-2020" military drills at the Turali range on the Caspian Sea coast in the Republic of Dagestan in Southern Russia on Sept. 23, 2020. Dimitar Dilkoff/AFP via Getty Images

U.S. sanctions took effect on Oct. 23 against 26 foreign companies linked to military programs in China, Iran, Pakistan, and Russia.

Sixteen are from Pakistan, six from China, three from the United Arab Emirates (UAE), and one from Egypt.

The companies on the Commerce Department’s Entity List are subject to specific licensing requirements for the export, reexport, and in-country transfer of specified items, and the license applications are likely to be denied.

The department’s Bureau of Industry and Security announced the sanctions on Oct. 21.

According to the bureau, seven Pakistani entities were sanctioned for contributing to the country’s ballistic missile program, and nine others were added to the list for acting as front companies and agents for the Advanced Engineering Research Organization, which itself was sanctioned in 2014 for smuggling U.S. technology in support of Pakistan’s missile and drone programs.

Six Chinese firms were sanctioned for acquiring U.S.-origin items in support of Beijing’s military modernization, attempting to delay and evade end-use checks, and procuring U.S.-origin items for Iran’s weapons of mass destruction (WMD) and drone programs.

Three companies from the UAE and one from Egypt were added to the list for evading U.S. sanctions and export controls imposed following Russia’s invasion of Ukraine in 2022, according to the bureau.

“[The sanctions send] a message to malicious actors that if they violate our controls, they will pay a price,” Alan F. Estevez, undersecretary of commerce for industry and security, said in a statement issued on Oct. 21.

Thea D. Rozman Kendler, assistant secretary of commerce for export administration, said in a statement, “Programs such as Iran’s WMD program, their unmanned aerial vehicle program, and Pakistan’s ballistic missile program pose significant threats to the national security of the United States and will not be aided by U.S. technologies.”

Sanctioned Chinese Firms

According to the bureau, Beijing Moreget Creative Technology was added to the Entity List for acquiring and attempting to acquire aviation simulation technology that originated from the United States to support China’s military modernization.

Hong Kong-based Small Leopard Electronics was sanctioned because it “repeatedly engaged in dilatory and evasive conduct in providing information to the U.S. Department of Commerce during end-use checks, including after being added to the Unverified List,” the bureau stated.

Shenzhen Dragonfly Supply Chain was sanctioned for selling items to a suspected supplier of goods to an Iranian procurement network.

Hong Kong-based Detail Technology, L-Tong Electronic Technology, and Shenzhen Jiachuang Weiye Technology Company were sanctioned for procuring or attempting to procure U.S-origin items for Iran’s WMD and drone programs, the bureau said.

The Chinese companies could not immediately be reached for comment.

The sanctions were announced after the Treasury Department sanctioned two Chinese firms on Oct. 17 for being involved in developing and manufacturing Russia’s Garpiya series of long-range attack drones.

It’s the first time that the United States has sanctioned Chinese entities responsible for developing and manufacturing full weapons systems in partnership with Russian firms.

Lifted Sanctions

The Bureau of Industry and Security also lifted human rights-related sanctions on Oct. 21 from China-based Hefei Bitland Information Technology and Canadian software firm Sandvine.

Hefei Bitland was sanctioned in 2020 for being implicated in China’s state-sanctioned human rights abuses in Xinjiang. The bureau removed the firm after its dissolution.

Sandvine was placed on the Entity List in February because it supplied technology to the Egyptian government, which used it for mass web monitoring and censorship.

The bureau said the company has undergone a major overhaul, including withdrawing from or starting to withdraw from 56 nondemocratic countries.

Sandvine told Reuters on Oct. 21 that its removal from the list recognizes its “commitment to transparency, ethical business practices, and the protection of digital rights,” adding that it “is transitioning to a model where its technology will only be sold in democratic countries.”