The introduction of the Provisions on the Unreliable Entity List (UEL) makes it clear that China’s trade compliance controls have made significant progress. For businesses, other organizations, and individuals based in China, it is crucial to incorporate UEL regulations into existing trade compliance programs. Various points in the UEL Provisions are subject to further discussions and refinement. But experts agree that the new system will be gradually improved and that it forms a key cornerstone of China’s new trade controls.
Various authorities around the globe publish official sanctions lists. The US OFAC and the EU are two examples. Now, China has joined them with its new Unreliable Entity List. It is just a matter of time until the first entries will be made and first measures will be enacted.
Restricted party screening is a key component in effective trade compliance programs. Compliance Screening from AEB offers various plans to meet different needs and secure global trade transactions.
The AEB solution also offers convenient machine translation of non-Latin characters – including Chinese. This delivers even more comprehensive coverage of your business partner screening.
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Trade compliance involves an abundance of national and international regulations. It is an area of dynamic developments and regular changes. China has made great progress in their national export control program in 2020 and there are many questions around the Unreliable Entity List. In this FAQ, our Global Trade Expert Olga Pramberger delivers insights.
The new Provisions on the UEL detail the following goals:
Trade compliance experts and various media publications summarize the UEL Provisions' goal as "protecting China's business and government interests".
The new Provisions on the Unreliable Entity List do not mention one authority in particular. Instead, they describe a "Working Mechanism" that refers to relevant central governmental authorities in China. The Office of the Working Mechanism is located at the competent department of commerce of the State Council. This Working Mechanism is in charge of organization and implementation of the UEL system. In this context, it is authorized to decide to announce investigations on the actions taken by relevant foreign entities based on:
If the facts about the relevant activities by foreign entities are clear, the Working Mechanism may directly take decisions to designate such entities. If the facts are not clear, the investigation results of the Working Mechanism will determine whether or not relevant foreign entities will be listed on the UEL. In either case, the following factors will be considered (at the discretion of the Working Mechanism) for the final decision :
The UEL Provisions are in accordance with the Foreign Trade Law of the People’s Republic of China, the National Security Law of the People’s Republic of China, and other relevant laws in this context.
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