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China has added 20 Japanese entities to its export control list and another 20 to its watch list as part of ongoing efforts to limit Japan’s military growth and nuclear ambitions.
Recently, the Ministry of Commerce announced the inclusion of Mitsubishi Heavy Industries Shipbuilding along with 19 other organizations believed to be contributing to Japan’s military expansion. Exporters within China are now restricted from supplying these entities with dual-use items, while international organizations and individuals are also prohibited from transferring or providing them with dual-use products originating from China. All current transactions involving these entities must be halted immediately.
The list of entities under surveillance includes Subaru, the Institute of Science Tokyo, Fuji Aerospace Technology, Mitsubishi Materials, and 16 others. This is the first time such a watch list mechanism has been activated, which subjects these organizations to increased scrutiny and risk assessment rather than imposing an outright ban.
The primary feature of this recent action is the initial activation of the watch list system, according to Ji Wenhua, a law professor at the University of International Business and Economics. The authorities clarified that these entities can apply to be removed from the list if they successfully demonstrate compliance with verification requirements, reflecting a commitment to legal due process.
Under the regulations governing dual-use items, effective since December 1, 2024, the commerce department has the authority to place importers on a watch list if their end-users or end-uses cannot be verified.
These control measures primarily target a specific group of Japanese organizations, focusing only on dual-use items, and are designed not to disrupt normal trade relations between China and Japan. The Ministry of Commerce reassured that compliant Japanese businesses should have no cause for concern.
The measures are based on articles 29 and 49 of the dual-use export control regulations, supporting layered controls on both direct exports and indirect transfers, illustrating China’s extraterritorial reach under its export control laws, Ji explained.
On January 6, the commerce department imposed a ban on all exports of dual-use items to Japanese military users or for military purposes that could enhance Japan’s military capabilities.
This move followed comments from Japanese officials on Taiwan, which China regards as a violation of the one-China principle and as interference in its internal affairs. The new dual-list system introduces a more sophisticated and targeted enforcement mechanism, expanding China’s export control toolkit further, Ji noted.
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