ChinaStepsUpEnforcementofCriticalMineralExportControls

China has penalized at least 11 companies this year for illegally exporting restricted rare earths and critical minerals as Beijing intensifies its crackdown on strategic resource smuggling.

The latest violation surfaced Thursday, when superhard material producer Monte-Bianco Diamond Applications Co. Ltd. announced it was fined 910,000 yuan ($133,914) for shipping state-controlled dysprosium in April 2025 without a required export license.

The sustained enforcement highlights Beijing’s determination to tightly track the global end-users of its critical materials, a move that raises compliance stakes for international high-tech and green energy supply chains.

Chinese authorities have increasingly targeted the unauthorized outflow of essential materials, including rare earth magnets and minerals such as gallium, titanium, and bismuth. Since mid-2023, China’s Ministry of Commerce has progressively rolled out export controls on key tech minerals, adding rare earths and related mining technologies to the restriction list in 2024.

The export controls do not constitute an outright ban; rather, they require exporters to secure licenses by disclosing end-uses and users. To evade these rules, some companies have resorted to mislabeling restricted dual-use materials under general customs codes.

In April, Puyang Refractories Group Co. Ltd. disclosed that prosecutors had indicted the company and arrested four individuals for smuggling. To supply its overseas subsidiaries, management mislabeled over 1,240 tons of natural flake graphite as general graphite powder to bypass the export controls implemented in late 2023, according to the Shenzhen-listed company’s disclosure.

Similarly, a subsidiary of solar panel maker JA Solar Technology Co., Ltd. was fined 1.3 million yuan early this year for shipping unlicensed graphite parts to Vietnam.

To further plug these export leaks, seven government bodies — including the Ministry of State Security, the Supreme People’s Court, and customs authorities — launched a coordinated anti-smuggling task force in Shenzhen earlier this month.

Contact editor Han Wei (weihan@caixin.com)