The China Question

www.worldecr.com 14 ThE ChInAquESTIOn CHINA anticipating that the restrictions are going to continue and because of that – in addition to revising the commercial documents and working on good documentation – we’re working with clients to diversify and find alternative sources. It’s not an elimination of China from the supply chain or customer base, but it’s a diversification.’ Since 2019, dozens of Chinese officials and companies have been sanctioned or blacklisted by the United States, the EU and the United Kingdom over alleged human rights abuses against Uyghurs and members of other minorities in China’s western Xinjiang region. In January, the United States reacted to allegations of widespread use of forced labour in Xinjiang by banning imports of cotton and other products from the region, with Canada and the UK following suit. e ban disrupted supply chains across the world: cotton from Xinjiang is among the best in the world and ends up in garments cut and sewn across Asia, from Bangladesh to Vietnam and exported across the world, making it extremely difficult for companies to have full confidence in their supply chains. ‘Whatever you have in your supply chain, instead of having only one source you should be trying to find other sources,’ Cinelli advises. ‘We’re seeing this in the semiconductor, telecommunications world, writ large in the financial world,’ she observes. Businesses around the world are trying to manage as best they can with oen unclear US regulations, some of them clearly rolled out in haste by the previous administration. o ‘whatever you have in your supply chain, instead of having only one source you should be trying to find other sources.’ giovanna Cinelli, Morgan lewis The first issue of the journal was published in May 2021 and is available as a free sample. If you would like to receive this sample copy please contact us on FISC@worldecr.com, and include your name, job title, organisation, and email. FISC is the sanctions compliance journal for ŕŸƳƿŕƿǇƿŕƄŸƳʓąŸĩʓƨƫƄňİƳƳŕƄŸąŭƳʓŕŸʓƿŐİʓȔŸąŸĢŕąŭʓ services sector, their advisors, and customers. Published six times a year, FISC addresses the sanctions and related V>i}iÃ v>V} Ìi w>V> ÃiVÌÀ] ÌiÀ VÕÃÌiÀÃ >` >`ÛÃÀÃ] ÜÌ insight and practical guidance on compliance. Articles in issue 1 include: Ƃ ÞÕ ii` Ì Ü VÀÞ«Ì] LVV> >` À>ÃÜ>Ài «>Vi Ìi vÀÌ iÃ\ Ü } } w>V> institutions are adapting to US sanctions /À>`i Ã>VÌÃ vÀ w>V> ÃÌÌÕÌÃ\ iÞ` " - >` " Ƃ >Û}>Ì} Ìi V>i}iÃ v Ã>VÌÃ V«>Vi Ƃ- Ƃ *ÀÀÌiÃ v w>V> ÃÌÌÕÌÃ >ÀÕ` Ìi }Li >` Ìi iÞ challenges facing the sector in 2021 /i ÌiÀ«>Þ v Ài«ÀÌ} L}>ÌÃ] «ÀÛi}i >` ViÌ `ÃVÃÕÀi vÀ 1 w>V> ÃÌÌÕÌÃ /i iÛÕÌ v VÕÃÌiÀ «iÀÃ> >i ÃVÀii} /i Ã>`Ü v ÃiV`>ÀÞ Ã>VÌÃ ->VÌÃ Ìi À`VÃ\ /i Ü`Ã >Ài V>}} />} > ÌÀÕ}Þ ÌiÀ>Ì> «iÀÃ«iVÌÛi] i>VÃÃÕi v - Ü VÕ`i «iÀÃ«iVÌÛiÃ vÀ i>`} iÝ«iÀÌÃ i}> «À>VÌVi] L>Ã >` ÌiÀ w>V> ÃÌÌÕÌÃ] }ÛiÀiÌ] `ÕÃÌÀÞ] >V>`i> >` ÌÌ>Ã° 7i >Ài Vw`iÌ Ì>Ì > ÃÕLÃVÀ«Ì Ü VÃÌÌÕÌi > ÕÃÌ>Ûi «iVi ÞÕÀ À}>Ã>Ì½Ã V«>Vi }Ã>Ü qi«} Ã>VÌÃ >` V«>Vi «ÀviÃÃ>Ã `iÛiÀ >` ÀiViÛi vÀi` >`ÛVi] Õ«Ã} ÌÃi iÜ Ì Ã>VÌÃ ÜÀ] >` «ÀÛ`} > platform for sharing best practice. Introducing Financial Institutions Sanctions Compliance (FISC), the new bi-monthly journal from WorldECR MAY 2021 ISSUE 01 • Trade sanctions for FIs: Beyond OFSI and OFAC • Bank Melli opinion: EU Blocking Regulation grows teeth • Sanctions in the Nordics – the winds are changing • How Hong Kong FIs are adapting to US sanctions on China Introducing Ian Bolton Ian Bolton is the Editor of FISC. Ian has worked in sanctions compliance for nearly a decade within the UK government, at the Foreign, Commonwealth and Development Office, in academia, at King’s College London, and in the banking sector, at HSBC UK. He has written on nuclear proliferation, maritime interdictions, and sanctions compliance for numerous journals (including for WorldECR), and has specialised in delivering sanctions compliance training and capacity building within government, industry and academia – ian.bolton@worldecr.com .