Why did China Blacklisted US Companies

China’s Ministry of Commerce has added four U.S. companies—Pacific Rim Defense, AEVEX Aerospace, LKD Aerospace, and Summit Technologies Inc.—to its “Unreliable Entity List” due to their involvement in arms sales to Taiwan.

This action prohibits these firms from engaging in import and export activities with China and restricts new investments within the country. Additionally, senior executives from these companies face bans on entering China, and any existing work permits or residence qualifications are to be revoked.

This move follows a similar announcement on January 14, 2025, when China blacklisted seven other U.S. companies, including Inter-Coastal Electronics and Anduril Industries, for their roles in arms sales to Taiwan.

China views these arms sales as violations of the one-China principle and the provisions of the three China-U.S. joint communiqués, asserting that they undermine its sovereignty and territorial integrity.

The U.S. has continued to approve arms sales to Taiwan, which it is legally obligated to support under the Taiwan Relations Act, despite lacking formal diplomatic ties. These sales are intended to bolster Taiwan’s self-defense capabilities amid increasing military pressure from China.

China’s recent sanctions are largely symbolic, given that many of the targeted companies have limited direct business with China. However, these actions underscore the escalating tensions between the U.S. and China over Taiwan, with both nations taking measures they deem necessary to protect their respective interests in the region.