MOC officials answer questions upon release of white paper on China's export controls

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The State Council Information Office released a white paper titled "China's Export Controls" on December 29, 2021. Officials in charge from the Ministry of Commerce took questions from the press regarding the background and the main content of the white paper and relationship between opening-up further and export control.

Question 1: What is the background and main content of the white paper on China's Export Controls?

Since the holistic approach to national security was put forward by President Xi Jinping after the 18th National Congress of the CPC, it has provided the fundamental basis and direction for efforts to improve China's export control system at a faster pace. The Export Control Law, enacted and implemented in 2020, was an important step to develop a full-fledged legal system for export control. Over the years, the Chinese government has coordinated development and security, opening-up and security, traditional security and non-traditional security, the security of itself and common security, and safeguarding and shaping national security. To strengthen export control on all dimensions and foster a modern export control system, China has actively fulfilled non-proliferation and other international obligations, adopted internationally-accepted practices such as export control list, end-users and end-uses management, optimized license management, created new enforcement methods, reinforced non-compliance penalties, and improved compliance regime.

Under this background, the white paper on China's Export Controls aims to give an overview of China's position, institutions, and practices in improving export control governance, and elaborate on China's commitments and actions to safeguard world peace and development, and security at national and international level. The 9,000-word long white paper is composed of foreword, main body, and conclusion. The main body consists of four parts: China's basic position on export control, continued improvement to the legal and regulatory system for export control, modernization of the export control system, international exchanges and cooperation.

Question 2: What's the current situation in international export control?

To safeguard world peace and development and effectively address international and regional security risks and challenges under the new circumstances, countries around the world are paying close attention to and working actively on export control under the framework of the UN and applicable international treaties. Efforts to establish and enforce legal systems, strengthen and standardize export control, and actively engage in international exchanges and cooperation, have helped to enhance mutual trust and dispel misunderstandings, promote international coordination on export control, and continuously improve the international export control governance.

At present, international export control also faces challenges. One of them is the abuse of export control measures and unreasonable discriminatory restrictions. Some countries, in particular, have generalized the concept of national security, fabricated excuses, directed state power to intervene in normal trade flow and market transactions, and frequently used export control as a tool to attack and bully other countries. Such moves have eroded the legitimate interests of fellow developing countries in the peaceful uses of controlled items, disrupted international industrial chains and supply chains, and jeopardized the sustainable development of many countries.

The second challenge is the attempts of countries to draw small circles and turn their back on true multilateralism, or even apply double standards on non-proliferation, which are in essence unilateralist practices under the pretext of multilateralism.

The third challenge is the need to enhance international coordination on export control and increase representation of the multilateral mechanisms on export control. China believes that in export control, the international community should move forward in a fair, reasonable, and non-discriminatory direction, remain united and enhance cooperation, resist discriminatory practices, and join hands in tackling global issues and building a brighter future for humanity.

Question 3: What is China's basic position on export control?

As a responsible major country, China adheres to a holistic approach to national security. In keeping with the principle of safeguarding world peace and development, national security and international security, China has been continuously improving export control governance, conscientiously undertaking its international obligations, and stepping up international exchanges and cooperation.

China holds that all countries should firmly stand by the international system centered on the United Nations and the international order underpinned by international law, safeguard the authority of international treaties and mechanisms that uphold true multilateralism, refresh their security perspectives, and adopt a common, comprehensive, cooperative and sustainable outlook on global security. In particular, major countries should duly fulfill their obligations, show a sense of responsibility, promote international common security in the field of export control, and actively advance international export control in a fair, reasonable, and non-discriminatory direction; they should not undermine the legitimate right of other countries to the peaceful use of controlled items, or obstruct the peaceful use of outcomes of scientific and technological advances to promote development, normal international science and technology exchanges and commercial cooperation, and the secure and smooth operation of global industrial and supply chains.

China holds that international cooperation on export control should promote the equality of rights, opportunities and rules for all, and reflect the wishes and interests of the majority in a more balanced manner. International coordination and cooperation and multilateral mechanisms should be further leveraged to properly address differences and disputes, and create an international environment of peace, stability, equality, mutual trust, and win-win cooperation, so that all countries can become partners that trust and work with one another on an equal footing in jointly building a community with a shared future for mankind.

Question 4: How does China view the relationship between opening-up and export control?

Opening-up is one of China's basic national policies and a unique icon, and expanding opening-up is the only path to high-quality development. Even as the world faces the compounded impact of major changes and a pandemic both unseen in a century, as well as growing anti-globalization trends, China is still dedicated to expanding openness, speeding up the building of an open economic system at a higher level, and pursuing opening-up on all fronts.

Over the years, China has been committed to coordinating development and security, and opening-up and security in implementing export control. With a view to building a new system of an open economy and a peaceful China at a higher level, China has been optimizing its business environment with enhanced regulatory openness and risk prevention and control capacity, thus safeguarding and promoting high-level opening-up by effectively guarding against major risks. At a new historical starting point, China will not change its resolve to open wider at a high standard; China will not change its determination to share development opportunities with the rest of the world; and China will not change its commitment to economic globalization that is more open, inclusive, balanced, and beneficial for all. China will continue to coordinate opening-up and security, strengthen bilateral and multilateral cooperation on trade and economic fronts, advance trade of export-controlled items that is consistent with compliance requirements, so as to contribute to an open world economy.

Question 5: What specific measures has the Chinese government taken to establish and improve a modern export control system?

China has been strictly enforcing export control laws and regulations. With institutional foundation and technological support, China has gradually realized effective and comprehensive regulation with full coverage and whole-process monitoring, and put in place a modern export control system with scientific design, orderly operation and vigorous enforcement.

First, improving license management. China widely adopts internationally-accepted practices such as license management, end-user and end-use certificates, and general licensing. China has established an inter-agency consultation mechanism and a two-tiered management model, optimized the licensing procedure, enriched the types of licenses, and kept improving license management, to promote trade of export-controlled items that is consistent with compliance requirements, and create a better business environment for high-level opening-up.

Second, strengthening enforcement capability. China has kept improving the export control enforcement mechanism by increasing enforcement methods. An authoritative and efficient export control enforcement system, with consistent rights and responsibilities, has gradually taken shape, and played an important role in tackling export control violations and ensuring complete, accurate and strict implementation of export control laws and regulations.

Third, developing export control compliance systems. Under the principle of government-guided, business-led, and coordinated action, China has scored notable progress in export control compliance system building by consolidating the legal foundation, improving the policy framework, and promoting publicity and training.

Four, complying with international obligations. Fulfilling its due responsibilities as a major country, China firmly upholds the authority and efficacy of relevant international treaties, strictly complies with its international obligations and honors its commitments on nuclear, biological and chemical weapons, missiles and military products, and safeguards international and regional peace and stability.

Question 6: How does China participate in international cooperation on export control?

It is an aspiration shared by most countries across the world to strengthen international coordination and cooperation and pursue shared development and common security. China prioritizes international exchanges and cooperation on export control as a step to promote international coordination and push forward relevant international processes, so as to contribute to greater justice and openness of international export control regime.

Bilaterally, based on mutual respect and mutual benefit, China has established inter-governmental mechanisms with various countries and regions to compare notes on practices through government-to-government consultations and discussions, as well as dialogues with businesses. China has actively promoted trade of export-controlled items that is consistent with compliance requirements, and been deeply involved in bilateral exchanges and cooperation on export control and non-proliferation to build up mutual trust. China supports non-governmental exchanges and cooperation on export control. Through academic researches and international people-to-people interactions with research institutions of relevant countries, these institutions have increased mutual understanding and friendship with foreign counterparts.

Multilaterally, China advocates that the United Nations, as the most universal organization in the world, should play a central role in initiating an open, inclusive and just dialogue process, safeguarding the legitimate rights of developing countries to peaceful uses of technological advancements, ensuring that scientific and technological dividends are widely shared to benefit all, and addressing the security challenges arising from scientific and technological progress. In December 2021, the 76th UNGA adopted the resolution "Promoting International Cooperation on Peaceful Uses in the Context of International Security", which is conducive to enhanced dialogues and exchanges between State members of existing mechanisms on non-proliferation and export control and other countries to better serve common security and shared development. Since its accession to the Nuclear Suppliers Group (NSG), China has actively taken part in NSG matters and assumed its membership rights and obligations. China also values dialogues and exchanges with the Missile Technology Control Regime, the Wassenaar Arrangement and the Australia Group.

Moving forward, China will continue to take up its due responsibilities as a major country, stay engaged in exchanges and cooperation on export control with other countries, uphold the UN-centered international system and enhance consultation and communication with multilateral mechanisms, in a bid to work toward the sound development of international export control governance.

Question 7: What are China's considerations for export control-related legislative development in the future?

On October 17, 2020, the 22nd Meeting of the Standing Committee of the Thirteenth National People's Congress adopted the Export Control Law of the People's Republic of China, which entered into effect on December 1, 2020. By establishing basic systems on export control scope, control policies, the control list, control measures, supervision and administration, and legal liabilities, among others, the Export Control Law lays a solid legal foundation for building a modern export control system and represents a milestone in China's export control development.

China will continue to advance law-based export control. In the future, under the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, we will pursue a holistic approach to national security, coordinate development and security, and aim to quicken our pace to develop a modern export control system with scientific design, orderly operation and vigorous enforcement. We will act promptly to improve supporting regulations for the Export Control Law, move faster to formulate the unified export control list, carry out multilateral and bilateral exchanges and cooperation on export control, widely publicize and implement related laws and policies, rigorously protect the legitimate rights and interests of all market players, and create enabling conditions for fostering a business environment that is based on market principles, governed by law and up to international standards.

Question 8: In what aspects will the Chinese government encourage and guide businesses to enhance export control compliance?

In order to encourage businesses to develop internal export control compliance systems in keeping with their own conditions, standardize business operation and create responsible corporate images, the Ministry of Commerce of China amended and published the Guiding Opinions on Establishing the Internal Compliance Program for Export Control by Exporters of Dual-use Items and the Guidelines for Internal Compliance for Export Control of Dual-use Items in April 2021 according to the Export Control Law and related regulations and based on the new characteristics of export control in the new era. Following the requirements of the aforementioned documents, businesses can develop and improve internal compliance systems by drafting policy statements, setting up institutions, comprehensively assessing risks, establishing screening procedures, formulating contingency measures, carrying out compliance training, improving compliance audit, keeping files and compiling management manual.

Going forward, China will work actively to develop a coordinated export control compliance system guided by the government and led by businesses to improve the whole society's export control compliance awareness, encourage businesses to improve compliance capacity and level, as well as safeguard and serve high-level opening-up.

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