Five Hong Kong companies have been sanctioned by the United States for reputedly providing support to Russia’s military and defense industrial base involved in the Ukraine war.
The Bureau of Industry and Security (BIS) of the US Department of Commerce announced on Tuesday (June 28) that it had added 36 entities to its Entity List for acting contrary to the US’ national security or foreign policy interests. Among them, 25 have China-based operations.
Among the five, four are registered in Hong Kong and one has a Hong Kong address. They include King Pai Technology Co Ltd, Sinno Electronics Co Ltd, World Jetta (H.K.) Logistics Ltd, Winninc Electronic and Connec Electronic Ltd.
The Chinese foreign ministry said Beijing opposed the US’ latest round of sanctions against Chinese companies as it had no basis in international law or any mandate of the United Nations Security Council.
It urged the US to revoke the sanctions and stop imposing long-arm jurisdiction and unilateral sanctions on Chinese businesses.
At the same time, 17 Chinese companies and three Chinese nationals were added to the US’ Entity List for reputedly having supplied items to Iran or threatening US national security.
BIS would review license applications for items for these entities under a presumption of denial while no license exceptions were available for exports, reexports, or transfers (in-country) to these entities, said the US Commerce Department.
Under Secretary of Commerce for Industry and Security Alan Estevez said: “The sweeping export controls put in place by the US and our allies and partners are restricting the Russian military’s ability to repair, replace, and resupply and will continue to bite harder the longer Putin persists.
“Today’s action sends a powerful message to entities and individuals across the globe that if they seek to support Russia, the US will cut them off as well.”
“The US and our allies and partners will continue to demonstrate our shared resolve on behalf of Ukraine by continuing to deny Russia’s military the technologies and items it needs to perpetrate its atrocities – from whatever source attempts to supply them, wherever they are located,” said Assistant Secretary of Commerce for Export Enforcement Matthew Axelrod.
Zhao Lijian, a China Ministry of Foreign Affairs spokesperson, said: “There is no basis for the US to slap sanctions on Chinese companies by citing domestic laws. China firmly opposes this.”
“China and Russia conduct normal economic and trade cooperation on the basis of mutual respect, equality and mutual benefit. This should not become the target of any intervention or restriction by a third party,” he said in a regular media briefing on Wednesday.
Zhao added that the US should not undermine China’s legitimate rights and interests in handling its relations with Russia.
Information about the five sanctioned Hong Kong companies can be found on their respective websites and Hong Kong’s company registry.
According to those sources, Sinno Electronics Co has its headquarters in Shenzhen, an office in Hunan’s Changsha and a warehouse in Hong Kong. It produces integrated circuits (ICs), sensors and LED lighting.
King Pai Technology was established in Hong Kong in 2018. It said it could produce two million types of electronic parts such as capacitors, transistors, inductors and diodes.
Winninc Electronics claimed to be a China independent distributor specialist offering integrated circuits, connectors, electromechanical and discrete components.
World Jetta (H.K.) Logistics Ltd is a Hong Kong-based logistic service provider established in 2013.
Connec Electronic Ltd was set up in the United Kingdom by a person named Renli Lu in 2014 and has a Hong Kong address. It supplies computers, computer peripheral equipment and software and electronic and telecommunications equipment and parts.
The export of Chinese civilian-use electronic parts and devices has been on the US’ radar since Russia invaded Ukraine in late February.
On March 12, a netizen posted a picture on the internet claiming that a Ukrainian found a circuit board made by Heng Sheng Lighting, a Wenzhou-based LED maker, inside a Russian missile that failed to explode.
An article published by a Chinese military website on March 14 said it was very likely that the Chinese circuit board was a part of the 9K720 Iskander, a mobile short-range ballistic missile system produced and deployed by the Russian army.
The article said the LED light was commonly used in the Digital Scene Matching Area Correlator (DSMAC) system in ballistic missiles.
The sanctions marked the first time that Hong Kong companies were penalized by the US over the Russia-Ukraine war.
The sanctions coincided with the release of the North Atlantic Treaty Organization (NATO)’s new “Strategic Concept“, which names China as a security challenge to the West due to its deepening strategic partnership with Russia.
The US has imposed several rounds of sanctions against Hong Kong companies and officials over the past two years over human rights and democracy-related issues.
On July 14, 2020, then-US President Donald Trump signed an executive order to end Hong Kong’s preferential economic treatment after Beijing implemented a new national security law on June 30 of the same year.
On September 17, 2021, the US Treasury Department imposed sanctions on seven companies and two Chinese individuals as they helped to open bank accounts in Hong Kong to launder vast sums of money for the Islamic Revolutionary Guard Corps’ Qods Force and Hezbollah and purchase US products and ship them to Iran.
Follow Jeff Pao on Twitter at @jeffpao3