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US Adds 3 Chinese Entities to Uyghur Forced Labor Prevention Act List: What Foreign Founders Operating in China Need to Know

China's Ministry of Commerce responds to new US sanctions under the Uyghur Forced Labor Prevention Act, affecting Chinese biomedical firms. Foreign founders in China should monitor compliance risks and supply chain impacts.

New US Sanctions Target Chinese Entities Under Uyghur Forced Labor Prevention Act

On October 28, the US Department of Homeland Security announced the addition of three Chinese entities to the entity list under the Uyghur Forced Labor Prevention Act. The move is part of ongoing US measures targeting Chinese businesses over alleged forced labor practices. China's Ministry of Commerce (MOFCOM) spokesperson responded to a question on this development on October 29, 2026, condemning the US action and outlining China's position.

For foreign founders registering or operating a company in China, this development highlights the importance of understanding the broader regulatory environment and potential compliance risks associated with international sanctions. While the immediate impact may be on the named entities, such actions can have ripple effects across supply chains and industries.

Key Facts from the MOFCOM Statement

The MOFCOM spokesperson provided the following details:

• US action: The US Department of Homeland Security added three Chinese entities to the entity list under the Uyghur Forced Labor Prevention Act on October 28 (US Eastern Time).
• China's position: China states that forced labor does not exist in China, and that all ethnic groups in Xinjiang enjoy free and equal employment, with labor rights effectively protected by law. The US measures are described as having no factual basis and as using human rights as a pretext for unilateral protectionism and bullying.
• China's response: China strongly condemns and firmly opposes the US action. It has previously lodged solemn representations and taken countermeasures against earlier listings of Chinese entities under the same act. The US has continued with new sanctions, including adding Chinese biomedical technology companies to the list.
• Impact on bilateral relations: The spokesperson stated that the US listing practice deviates from the consensus reached by the two heads of state, seriously disrupts the stability of China-US economic and trade relations, and goes against humanitarian spirit. The US is urged to stop political manipulation and unreasonable suppression of Chinese enterprises.
• China's next steps: China will take necessary measures to resolutely safeguard its interests.

Implications for Foreign Founders in China

Foreign founders operating in China should be aware that geopolitical tensions can affect business operations, particularly if their company engages in international trade, has US connections, or operates in sensitive sectors such as biomedical technology. The US sanctions target specific Chinese entities, but they may also affect supply chains and partnerships.

It is crucial to stay informed about regulatory changes and to assess potential risks. Companies should review their supply chains and business relationships to ensure compliance with applicable laws and regulations. While the MOFCOM statement focuses on the US action, it also signals China's willingness to take countermeasures, which could impact foreign businesses operating in China.

Foreign founders should consider the following practical steps:

• Monitor regulatory updates: Keep abreast of announcements from both US and Chinese authorities that may affect your industry or business partners.
• Conduct due diligence: Regularly review your supply chain and business relationships to identify any potential exposure to sanctioned entities.
• Engage legal counsel: Consult with legal experts to understand how international sanctions and Chinese regulations may apply to your specific situation.
• Maintain open communication: If your business is affected, communicate proactively with relevant authorities and stakeholders.

China's Business Environment and Legal Protections

The MOFCOM statement reiterates China's position that labor rights are protected by law and that employment is free and equal for all ethnic groups. For foreign founders, this underscores the importance of complying with Chinese labor laws and ensuring ethical practices. China continues to emphasize its commitment to a stable business environment, but foreign companies must navigate an increasingly complex global landscape.

When registering a company in China, foreign founders should ensure they understand local labor regulations, including those related to employment contracts, working hours, and social insurance. While the US allegations are disputed by China, companies should still uphold high standards of corporate social responsibility.

Conclusion

The US addition of Chinese entities to the Uyghur Forced Labor Prevention Act entity list is a reminder that foreign founders in China must stay vigilant about international regulatory developments. By understanding the facts and taking proactive measures, businesses can mitigate risks and focus on their growth in the Chinese market.

For assistance with company registration and navigating the regulatory landscape in China, foreign founders can contact ChinaMNC on WhatsApp / WeChat at +86 153 1898 8535.

This summary is based on information published by the relevant Chinese government website and is general information, not legal or tax advice.