Biden to remove some Chinese companies from a ‘red-flag’ trade list

President Biden plans to remove Chinese companies from the red-flag trade list, signaling his desire to improve ties with the communist country on issues such as climate change.

The move was spurred by the Chinese Commerce Ministry’s increased willingness to permit the U.S. to determine whether those companies can be trusted to receive sensitive technology exports, Reuters reported. Beijing had been unwilling to grant such access in the past.

It was unclear how many companies or entities would be removed from the list. The Commerce Department did not respond to a request for comment from The Washington Times.

Companies land on the “red-flag” list because the U.S. is blocked from conducting on-site visits to determine whether they can be trusted to receive sensitive U.S. technology exports. Such inspections require the approval of China’s Commerce Ministry.

Under new rules adopted in October, if a government prevents U.S. officials from conducting site checks for companies on the list, Washington may add them to the entity list after 60 days. The entity list carries harsher penalties than the red-flag list.

Once the deal is finalized, U.S. exporters will no longer have to conduct additional due diligence before sending goods to the Chinese companies removed from the list, according to the report.