Q: On 24 February 2026, MOFCOM released restricted namelist and a watch list. What are the considerations behind this move?

A: In accordance with the Export Control Law of the People’s Republic of China, the Regulations of the People’s Republic of China on Export Control of Dual-Use Items, and other applicable laws and regulations, the Chinese side has decided to take the following measures:

1. Adding 20 entities involved in activities enhancing Japan’s military capabilities, including Mitsubishi Heavy Industries Shipbuilding Co., to the restricted namelist. Exporters are prohibited from supplying dual-use items to these entities; overseas organizations and individuals are prohibited from transferring or providing dual-use items originating from China to these entities. Ongoing activities of this nature shall cease immediately.

2. Placing 20 Japanese entities, including SUBARU Corporation, that are unable to be verified the end users or end uses of dual-use items on the watch list. Exporters may not apply for general licenses or obtain export certificates through registration procedures when exporting dual-use items to the listed entities. For individual licenses, exporters shall submit a risk assessment report and provide a written commitment that the items will not be used for any purpose that contributes to enhancing Japan’s military capabilities. The review period for such licenses is not subject to the time limits specified in Paragraph 1, Article 17 of the Regulations on Export Control of Dual-Use Items. MOFCOM will conduct stricter reviews of the end users and end uses for exported dual-use items involving entities on the watch list. Applications involving Japanese military users, military purposes, or any other end uses that may contribute to enhancing Japan’s military capabilities will not be approved. Entities on the watch list may apply for removal after fulfilling relevant obligations under Article 26 of the Regulations on Export Control of Dual-Use Items, and MOFCOM may remove them upon verification.

For listed Japanese entities, the measures outlined in this announcement will apply. For Japanese entities which are not listed, if their activities involve Japanese military users, military purposes, or any other end uses that may contribute to enhancing Japan’s military capabilities, dual-use item exports to them shall be prohibited in accordance with the Announcement on Tightening Export Control of Dual-Use Items to Japan. The purpose of these measures is to curb Japan’s attempts at “remilitarization” and possession of nuclear weapons, and these measures are completely justified, reasonable, and lawful. Such actions in accordance with the law target only a small number of Japanese entities, and apply only to dual-use items. These measures do not affect normal economic and trade exchanges between China and Japan. Japanese entities that operate in good faith and comply with the law have no cause for concern.