US sanctions Chinese military firm for buying Russian jets

The Trump administration on Thursday targeted a Chinese military organization and its leader over its purchases of fighter jets and missiles from the Kremlin.

The State Department announced that it had imposed financial restrictions on China’s Equipment Development Department (EDD) and its director, Li Shangfu under a Russian sanctions law passed by Congress last year.

The law, known as the Countering America’s Adversaries Through Sanctions Act (CAATSA), mandates financial penalties for any person or firm that engages in significant financial transactions with Russian military entities.

EDD and Shangfu were targeted for purchases of Su-35 combat aircraft and equipment for S-400 surface-to-air missile systems from Russia in late 2017 and early 2018, the State Department said.

The transactions occurred after CAATSA became effective and drew scrutiny from U.S. monitors because of the high value of the equipment included, a State Department official said.

The designations of EDD and Shangfu mark the first time that the Trump administration has targeted a non-Russian person or entity for violating sanctions meant to punish the Kremlin.

While EDD is a major component of the Chinese military, the State Department official said that administration wants “to emphasize that the ultimate target of these sanctions is Russia” and “are not intended to undermine the defense capabilities of any particular country.”

President Trump signed an executive order earlier Thursday authorizing the State Department to impose the sanctions and listed the financial penalties to be applied to EDD and Shangfu.

Under the sanctions, EDD and Shangfu can no longer engage in the U.S. financial system, acquire U.S. export licenses, and access foreign exchanges under U.S. jurisdiction. EDD and Shangfu are also barred from accessing any of their assets in U.S. jurisdiction, and Shangfu is now banned from acquiring a visa to visit the U.S.

U.S. nationals and firms could also face financial penalties under the sanctions if they engage in transactions with EDD or Shangfu.

The Treasury Department also announced Thursday that it had added 33 Russian nationals and firms connected to the Kremlin’s military and intelligence operations to its list of individuals sanctioned under CAATSA. All 33 listed Russians had been subject to financial sanctions under other laws and orders, and include the 25 persons and entities indicted by special counsel Robert Mueller.