CHINA – Export Control Law, new legislation on export control

The Beijing government, in order to standardize the pre-existing regulatory framework, comply with international obligations assumed, improve export control and safeguard national security and interests, has introduced specific restrictions on the export of certain items which include sanctions and obligations also for importers and end users located outside of China.

The legislation in question requires the competent authority to produce a list of unreliable entities that includes importers and end users who violate the requirements relating to the management of end users and end uses, as well as importers and users who may endanger safety. national or national interests and who use the so-called “controlled items” for terrorist purposes.

Any organization or individual, even outside China, that violates the provisions of the ECL, endangers national security and the national interests of China and hinders the fulfillment of proliferation obligations and other international obligations, are subject to the Export Control Law.

The products subject to export control are:

• Dual use products
• Military products
• Nuclear products
• Goods, technologies and services that may be related to maintaining national security, national interests and anti-proliferation obligations or other international obligations

As well as the new dual use regulation that entered into force in the European Union, technical assistance and the supply of the related technology are also subject to authorization in the Export Control Law.
As for the end user, according to the legislation, he must undertake not to modify the final use of the controlled asset and not to transfer it to third parties without first obtaining the appropriate authorization from the competent authorities. On the other hand, as regards controlled products that are re-exported, it is mandatory to request authorization, present a certification on the final use of the asset and on the end user of the same and report any changes relating to the final use or user of which it is aware.

The consequences for foreign entities who fail to comply with these obligations can lead to the inclusion in the above list of unreliable entities, which would lead to a ban on conducting transactions or investments in China, a ban on entry into Chinese territory or a revocation / denial of a work or residence permit.

We strongly recommend that you contact Chinese suppliers to understand if the products purchased can fall under this legislation and understand exactly what are the procedures and obligations that the Community importer must carry out.

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