China Not Pleased With NDAA Export Control Provisions

President Donald Trump signed the fiscal year 2020 National Defense Authorization Act, S. 1790 into law, with provisions targeting tech companies Huawei and ZTE (see 1912130027), the White House announced on Dec. 20. The law bars the Trump administration from lifting the Commerce Department Bureau of Industry and Security's addition of Chinese telecom equipment manufacturer Huawei to its export entity blacklist without congressional approval. The law also requires reports to Congress on waivers issued to companies doing business with Huawei as well as ZTE's compliance with a 2018 agreement that lifted Commerce's ban on U.S. companies selling telecom software and equipment to ZTE.

The China Ministry of Commerce took issue with those provisions during a Dec. 26 press conference. “We have noticed that the U.S. National Defense Authorization Act for FY 2020 has been signed into law, which contains a number of unfavorable provisions for Chinese companies,” a ministry spokesman said, according to an unofficial translation. “China is firmly opposed to this.”

Specifically, “the Chinese side believes that the provisions of the Act on restricting the purchase of Chinese products and tightening export control sanctions against Chinese enterprises are a bad example of state intervention in the normal business activities of enterprises, which is in stark contrast to the fairness, equality, and free trade promoted by the United States,” the spokesman said. China plans to “pay close attention to the impact on the Chinese enterprises during the implementation of the 'Bill' and take all necessary measures to protect the legitimate rights and interests of Chinese enterprises,” he said.