Lockheed Martin photo:VCG

China on Tuesday told domestic firms to strictly avoid trade with Lockheed Martin Corp and Raytheon Missiles & Defense after the two major US defense contractors were added to its unreliable entities list in February for participating in arms sales to the island of Taiwan. 

China has already banned senior executives of the two firms from entering, working, staying and residing in the country since February 16, the Ministry of Commerce (MOFCOM) said in a statement published on its official website on Tuesday.

"The two firms have long been involved in arms sales to the island of Taiwan, which is of a malicious nature, so we decided to prohibit the two US companies from engaging in import and export activities related to China, with the aim of preventing Chinese products from being used in their military industry," read the statement.

The MOFCOM told domestic firms not to conduct any relevant import and export activities when engaging in activities such as export, transit, transfer and transportation, if they become aware that the actual importer or user is either of the two American companies mentioned above. 

"Relevant departments will investigate and hold responsible those who violate these regulations in accordance with the law," the ministry said in the statement.

On February 16, MOFCOM added the two companies to its unreliable entities list and imposed several sanctions on the companies, including a ban on trade activities related to China and huge fines, for participating in arms sales to the island of Taiwan. 

This is apparently the first time that specific companies have been added to the country's unreliable entities list, which has been in the making for about three years, demonstrating China's resolve to punish foreign entities that undermine China's national sovereignty, security and development interests, Chinese analysts said. 

China first announced plans to establish the list in March 2019, as the US government waged a trade war against China and cracked down on Chinese firms with its own so-called Entity List. 

In September 2020, regulations on the list were released and took effect. Under the regulations, the list targets foreign entities that are involved in activities that endanger China's national sovereignty, security or development interests and take discriminatory measures against Chinese entities and individuals. 

Global Times