China targets US firms and drone exports after FCC, Xinjiang actions

China has imposed retaliatory trade restrictions on seven US entities, tightened export controls, and restricted US agencies' role in factory inspections in response to recent US trade measures.

China's Commerce Ministry on Wednesday barred domestic organisations and individuals from doing business with seven U.S. entities, tightened export controls on U.S.-bound drones and related technology, and restricted U.S. agencies' role in mandatory ‌Chinese factory certification inspections.

Beijing said the moves responded to recent U.S. restrictions affecting Chinese telecom operators, testing laboratories, drones, consumer routers, submarine cables, advanced robotics equipment and power inverters. It also cited Washington's addition last week of more than 40 Chinese entities to its Uyghur Forced Labor Prevention Act entity list.

The announcement also came after Reuters reported that the Trump administration ‌was drafting a national-security measure to bar U.S. imports of new models of Chinese data-centre components, including optical transceivers. "This is a retaliatory move, and it's hardly a ‌surprising one," said Alfredo Montufar-Helu, Beijing-based managing director at Ankura China. "Beijing has spent the past several months building out its countermeasures toolkit."

The steps mark the latest escalation in U.S.-China trade and technology tensions, with Washington tightening restrictions on Chinese access to U.S. technology and markets, and Beijing responding with export curbs and sanctions on selected U.S. entities. BUSINESS RESTRICTIONS

China put Mesa, Arizona-based Compliance Testing LLC on a countermeasures list, barring Chinese organisations ⁠and individuals from ​dealing or cooperating with it. Beijing said ⁠the testing and certification firm had assisted and supported recent U.S. Federal Communications Commission measures targeting China, which it said harmed Chinese companies' legitimate rights and interests, without elaborating.

In April, the FCC adopted a fast-track ⁠review process for devices tested in U.S. or reciprocal-country laboratories, while proposing to stop recognising testing laboratories and certification bodies in countries without reciprocal arrangements with Washington. If finalised, the proposal could make ​it harder for China-based labs and certification bodies to help manufacturers obtain FCC equipment authorization for devices sold in the United States.

China separately imposed the same business-dealing ⁠ban on Applied DNA Sciences, Stratum Reservoir, Altana Technologies, the Responsible Business Alliance, Verité Group and Human Rights in China, accusing them of supporting U.S. Xinjiang-related sanctions. Several work on supply-chain tracing, labour-risk assessments or human-rights advocacy. The ⁠orders ​did not specify asset freezes or travel bans.

DRONES, CERTIFICATION AND PRINTER PROBE China said controlled drones, key components and related technology destined for the United States would undergo stricter case-by-case review, without streamlined licensing. The measure is not a blanket ban but could delay shipments covered by China's dual-use export-control rules.

Beijing also suspended U.S.-based agencies from ⁠conducting follow-up factory inspections under China's mandatory certification system, potentially raising costs and delays for manufacturers. Separately, Beijing launched a national-security investigation into imported printing, copying and office equipment.

The investigation does ⁠not name the United States or specific companies, ⁠but the Commerce Ministry explicitly included it among its responses to recent U.S. actions. Montufar-Helu said Beijing's language signaled frustration with recent U.S. moves, which China views as inconsistent with bilateral understandings.

"Both Beijing and Washington keep reaching for calibrated, targeted measures rather than ‌sweeping ones," he said, suggesting neither ‌side wants tensions to spiral.