On December 16, 2021, the Department of the Treasury’s Office of Foreign Assets Control (OFAC) added eight Chinese entities to its Non-SDN Chinese Military-Industrial Complex Companies (NS-CMIC) list for “actively support[ing] the biometric surveillance and tracking of ethnic and religious minorities in China, particularly the predominantly Muslim Uyghur minority in Xinjiang.” As such, U.S. persons will be prohibited from purchasing and/or selling certain publicly traded securities connected with these eight entities. The eight entities include:
- Cloudwalk Technology Co., Ltd.;
- Dawning Information Industry Co., Ltd.;
- Leon Technology Company Limited;
- Megvii Technology Limited;
- Netposa Technologies Limited;
- SZ DJI Technology Co., Ltd.;
- Xiamen Meiya Pico Information Co., Ltd.; and
- Yitu Limited.
Most notable is SZ DJI Technology (DJI), which is the world’s largest drone manufacturer. As noted by OFAC, DJI was added to the list because the company has “provided drones to the Xinjiang Public Security Bureau, which are used to surveil Uyghurs in Xinjiang. The Xinjiang Public Security Bureau was previously designated in July 2020, pursuant to E.O. 13818, for being a foreign person responsible for, or complicit in, or that has directly or indirectly engaged in, serious human rights abuse.”
DJI is also currently on the Department of Commerce’s Bureau of Industry and Security’s (BIS’s) Entity List. The company was added with three other Chinese companies on December 22, 2020 via 85 FR 83416 after BIS identified that the companies had “enabled wide-scale human rights abuses within China through abusive genetic collection and analysis or high-technology surveillance, and/or facilitated the export of items by China that aid repressive regimes around the world.”
The press release by OFAC announcing the addition of the eight companies is available here.
For more information on OFAC sanctions as well as actions addressing forced labor and human rights abuses, contact our team and see previous posts below.
CBP Issues Forced Labor Withhold Release Orders on Malaysian Gloves and Mexican Tomatoes | International Trade Law (cmtradelaw.com)
Bureau of Industry and Security (BIS) Adds Five Chinese Entities to Entity List for Participating in China’s Forced Labor Campaign Against Muslims in Xinjiang | International Trade Law (cmtradelaw.com)