US bars 24 Chinese firms for role in building military islands in South China Sea

The Bureau of Industry and Security (BIS) in the US Department of Commerce has added 24 companies from the People’s Republic of China to the restricted list of foreign entities (Entity List) for their role in helping the Chinese military construct artificial islands and militarise the South China Sea.

Despite protests from the United States and countries sharing the South China Sea, and international condemnation, including by the United nations, the government of the People’s Republic of China (PRC) has been rapidly building the artificial islands since 2013, undermining the sovereign rights of countries in the region, the Commerce Department pointed out. 
“The United States, China’s neighbors, and the international community have rebuked the CCP’s sovereignty claims to the South China Sea and have condemned the building of artificial islands for the Chinese military,” said Commerce Secretary Wilbur Ross. “The entities designated today have played a significant role in China’s provocative construction of these artificial islands and must be held accountable.”
Since 2013, the CCP has dredged and constructed more than 3,000 acres across seven features in the South China Sea, which include air defense and anti-ship missile features. In addition, the PRC’s dredging and construction of certain outposts violates the sovereign rights of the Republic of the Philippines, as determined by the Permanent Court of Arbitration in its July 2016 award in a case brought by the Philippines against the PRC. Commerce determined these entities enabled China to construct and militarise disputed outposts in the South China Sea.
The Entity List is a tool utilised by BIS to restrict the export, re-export, and transfer (in-country) of items subject to the Export Administration Regulations (EAR) to persons (individuals, organisations, companies) reasonably believed to be involved, or to pose a significant risk of becoming involved, in activities contrary to the national security or foreign policy interests of the United States. 
Additional licence requirements apply for exports, re-exports, and transfers (in-country) of items subject to the EAR to listed entities, and the availability of most licence exceptions is limited. 
The companies placed on the Entity List for enabling the PRC reclaim and militarise disputed outposts in the South China Sea include:
  • China Communications Construction Company Dredging Group Co, Ltd.
  • China Communications Construction Company Tianjin Waterway Bureau,
  • China Communications Construction Company Shanghai Waterway Bureau,
  • China Communications Construction Company Guangzhou Waterway Bureau,
  • China Communications Construction Company Second Navigation Engineering Bureau,
  • Beijing Huanjia Telecommunication Co, Ltd,
  • Changzhou Guoguang Data Communications Co, Ltd,
  • China Electronics Technology Group Corporation, 7th Research Institute (CETC-7),
  • Guangzhou Hongyu Technology Co, Ltd, (a subordinate institute of CETC-7),
  • Guangzhou Tongguang Communication Technology Co Ltd (a subordinate institute of CETC-7),
  • China Electronics Technology Group Corporation, 30th Research Institute (CETC-30),
  • China Shipbuilding Group, 722nd Research Institute,
  • Chongxin Bada Technology Development Co Ltd,
  • Guangzhou Guangyou Communications Equipment Co Ltd,
  • Guangzhou Haige Communication Group Co Ltd,
  • Guilin Changhai Development Co Ltd,
  • Hubei Guangxing Communications Technology Co Ltd,
  • Shaanxi Changling Electronic Technology Co Ltd,
  • Shanghai Cable Offshore Engineering Co Ltd,
  • Telixin Electronics Technology Co Ltd,
  • Tianjin Broadcasting Equipment Co Ltd,
  • Tianjin 764 Avionics Technology Co Ltd,
  • Tianjin 764 Communication and Navigation Technology Co Ltd, and
  • Wuhan Mailite Communication Co Ltd.