China moves to shield its own advanced tech in fight with US by expanding arsenal of export restrictions

China is set to pass a new law that would restrict sensitive exports vital to national security, expanding its toolkit of policy options as competition grows with the US over access to technologies that will drive the modern economy.

China’s top legislative body, the National People’s Congress Standing Committee, is expected to adopt the measure in a session that concludes on Saturday. The Export Control Law primarily aims to protect China’s national security by regulating the export of sensitive materials and technologies that appear on a control list. It would apply to all companies in China, including foreign-invested ones.

The measure would add to Beijing’s regulatory arsenal, which also includes a tech export restriction catalogue and an unreliable entity list. The law would also help put China on a similar footing to the US, which regularly uses export controls and licenses strategically against its adversaries.

Mounting tensions between China and the US have spilled over into the realm of technology. Big Chinese companies including Huawei Technologies, ByteDance’s TikTok, Tencent Holdings’ WeChat and Semiconductor Manufacturing International Corp. find themselves in Washington’s cross hairs.

“Chinese authorities may have learned a lesson from the US and other countries,” said Qing Ren, a partner at Global Law Office in Beijing.

A report carried by official Xinhua News Agency said the draft law stipulates that China could take reciprocal measures against a certain country or region that has “abused export control measures and damaged China’s national security and interests.”