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Encryption first target of China's new export restriction law

Rare-earth minerals left off initial list in latest escalation

WeChat messages encrypted by Chinese app LeakZero are seen on a mobile phone.   © Reuters

BEIJING -- Encryption technology and chips for ensuring data security are among the first areas subject to China's new export control law, while rare-earth minerals were not included.

The initial list, announced Wednesday by China's Ministry of Commerce and customs authorities, includes equipment and services that use commercial encryption geared toward such fields as electric utilities and finance. The restrictions will apply starting Jan. 1.

Chinese companies seeking to export products on the list will need to be cleared by the Commerce Ministry beforehand. Seen as a response to U.S. sanctions, the new export control law, focused on strategic materials and advanced technologies, took effect Tuesday.

Products subject to import restrictions, such as phones and fax machines with encryption features, were announced as well.

"China will strengthen the independent research, development and protection of core technologies related to national security," President Xi Jinping said Monday. China positions encryption as such a technology and seeks to keep such know-how from reaching the hands of others with the tightened export controls.

With many personal computers featuring semiconductors for data security, delays in exports would pose the risk of supply chain disruptions.

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