China announced sanctions on 10 American military-related companies on Sunday, blocking them from receiving “dual-use” exports, in direct retaliation for a U.S. move barring several leading Chinese technology firms from American defense contracts.
Under the measures, Chinese companies are prohibited from exporting dual-use items — goods with both civilian and military applications — to the 10 firms. Companies or individuals in third countries are likewise barred from transferring such items of Chinese origin to the sanctioned American businesses, an effort to close indirect supply routes.
The targeted companies span drones, defense systems and rare-earth materials: AVEOX of Simi Valley, California; Red Cat Holdings and Teal Drones of South Salt Lake, Utah; IMSAR of Springville, Utah; Jaia Robotics of Bristol, Rhode Island; Ball Aerospace & Technologies of Broomfield, Colorado; Oshkosh Defense of Oshkosh, Wisconsin; L3Harris Maritime Services of Norfolk, Virginia; MP Materials of Las Vegas; and USA Rare Earth of Stillwater, Oklahoma.
China’s Commerce Ministry said the export ban was intended both to safeguard national security and to respond to what it called Washington’s “wrongful expansion” of its List of Chinese Military Companies, a Pentagon designation that restricts targeted firms’ access to U.S. business.
The inclusion of MP Materials and USA Rare Earth is pointed: both are central to American efforts to build a domestic rare-earth supply chain and reduce dependence on China, which dominates the processing of the minerals essential to advanced weapons and electronics.
The exchange marks a further hardening of the technology and defense rivalry between the world’s two largest economies, in which each side increasingly wields export controls and entity lists as instruments of strategic competition.
Analysts warned that the escalating curbs raise costs and uncertainty for defense contractors and rare-earth developers on both sides, while doing little to resolve the underlying contest over who controls the supply chains behind next-generation military technology.