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2022: A Review Of Foreign Sanctions And Export Control Developments Involving China – Export Controls & Trade & Investment Sanctions


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In the world of sanctions compliance, the main focus of 2022 was
the Russia-Ukraine war. G7 policy makers continue demonstrating a
strong commitment to cooperation. The set-up of the Russian Elites, Proxies, and Oligarchs
(“REPO”) Task Force
and the OFSI-OFAC enhanced partnership last year are
good examples of this multilateral cooperation. Since the war
outbreak, new sanctions measures have been introduced at an
unprecedentedly rapid pace. Businesses and governments are still
adapting to the changes resulting from the sanctions measures
– including energy shortages, and rising commodity prices, to
name just two.

Turning our eyes to China, the sanctions and export control
activities in 2022 continued the regulatory trends we had seen in
the previous year.


The following are some key takeaways:

  • U.S. regulators continued restricting the export of
    critical technologies to China.
    The U.S. has especially
    tightened the export control of certain technologies, e.g.,
    electronic design automation (“EDA”) and advanced chips.
    Restrictions on end users were extended. Almost 70 entities were
    added to the BIS Entity List last year. While the U.S. Department
    of Defense extended the Chinese Military Companies list by 13
    entities in October, no new entity was added to the OFAC Non-SDN
    Chinese Military-Industrial Complex Companies List
    (“NS-CMIC”) in 2022.

  • Human rights accusations remain a key reason for
    China-related designations.
    Uyghur Forced Labor Prevention
    Act (“UFLPA”) came into effect in June 2022. A new UFLPA
    Entity List was introduced at the same time. In 2022, over 50
    Chinese individuals and entities, as well as 157 Chinese vessels
    were added to SDN lists. Most designations were made under the
    Global Magnitsky, Iranian and North Korean programs. Furthermore,
    several BIS Entity List additions were due to the alleged use of
    forced labor. No new listing was made under the Hong Kong

  • China is further strengthening its legal framework of
    export control.
    In June, China Ministry of Commerce issued
    the Export Control Regulations for Dual-Use Items (Draft for Public
    Comment) in order to streamline the export regulation of dual-use
    goods as defined in China’s Export Control Law. The Unreliable
    Entity List remains empty. In September, the Measures for the
    Security Assessment of Data Exports took effect, setting
    requirements for exporting important data and personal

  • Taiwan gained attention as a source of sanctions
    In 2022, the Chinese government announced only a
    handful of sanctions on foreign officials and entities – the
    majority of those were related to activities allegedly supporting
    Taiwan’s independence. The cross-strait relationship between
    China and Taiwan will likely remain a key risk area to monitor in
    the coming years.


U.S. regulatory measures against China accelerated in the second
half of 2022. This trend is expected to continue into 2023. U.S.
Deputy Attorney General Lisa Monaco publicly called sanctions
the new FCPA“. There seems little doubt
that U.S. regulators and enforcement agencies will step up their
regulatory supervision and enforcement actions in the future. We
recommend that multinational companies consider the following
measures to stay prepared for the increasing regulatory

  • Actively monitor sanctions policy updates, enforcement
    trends, and assess the risk exposure
    based on their
    business and operational footprint.

  • Establish a sanctions compliance program if
    they have not done so and regularly revisit its
    , including testing of relevant internal

  • Enhance the business continuity plan to
    incorporate measures in response to sudden escalations of sanctions
    and export control measures in sensitive industries and regions.
    This is especially relevant to corporates producing or trading
    dual-use goods or technologies on the Critical and Emerging
    Technologies List, such as advanced computing and aero engines.
    This also applies to financial institutions as they must take swift
    actions to implement new regulations.

  • Diversify supply chains to reduce the business
    impact of unexpected disruption caused by potential sanctions in
    high-risk regions and industries.

AlixPartners has deep expertise in assisting financial
institutions and corporates to develop sanctions compliance
programs, manage supply chain disruption and overcome operational
challenges. Please reach out if you have any inquiries relating to
this article or our services.

The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.

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