The European Union is contemplating a nine-month exemption from sanctions for Yangzhou Yangjie Electronic Technology, a Chinese firm previously restricted due to its semiconductor supplies to Russia. This announcement was made by Siobhan McGarry, a spokesperson for the European Commission, during a briefing on June 8.
Yangzhou Yangjie was included in the EU’s 20th sanctions package for significantly aiding Russian military capabilities by supplying equipment used in drones and glide bombs. These munitions have been deployed by Russian forces in the ongoing conflict in Ukraine, as noted by McGarry.
Although the company will remain on the EU’s sanctions list, the European Commission is proposing a temporary exemption at the request of European automotive manufacturers. McGarry explained, “We are offering a nine-month temporary exemption because this company is a key supplier for several European automotive firms, and sanctions could lead to serious disruptions in their chip supply chains.”
It is important to clarify that this exemption does not equate to a removal from the sanctions list. McGarry emphasized, “The company remains under sanctions.” The Financial Times previously reported that European car manufacturers are concerned about a potential new chip supply crisis, as producing a single vehicle can require up to 3,000 microchips, which are essential for various functions from tire pressure monitoring to lighting.
In light of upcoming Chinese export restrictions on chips and rare earth materials in 2025, some European factories have already been forced to reduce or temporarily halt production. The European Commission asserts that the nine-month exemption is necessary to allow European companies time to identify alternative suppliers and renegotiate contracts.
Any modifications to the EU’s sanctions regime must receive unanimous approval from all member states.
The EU is considering a temporary nine-month exemption from sanctions for Yangzhou Yangjie Electronic Technology, a Chinese supplier of semiconductors to Russia. This move aims to mitigate potential disruptions in the automotive supply chain while maintaining the company's status on the sanctions list.
Source: Radio Free Europe