According to Reuters, a lobby group made up of U.S. companies such as Oracle, Amazon and ExxonMobil is urging the U.S. government to immediately suspend a trade rule against China. The group says that the penetration rule has caused billions of dollars worth of U.S. export activities to be blocked and will encourage countries such as China to remove U.S. companies from their supply chains.

The lobbying organization, the U.S. National Foreign Trade Commission, called the rule, the export control penetration rule announced by the U.S. Department of Commerce on September 29. According to the rule, subsidiaries with more than 50% of the shares of enterprises included in the U.S. ¡°entity list¡± were also included, prohibiting access to U.S. technology and products.

The U.S. National Foreign Trade Commission noted that the rule would hinder U.S. companies¡¯ export plans and contradict the government¡¯s trade policy. According to Reuters, the committee¡¯s chairman, Jack Colvin, in a letter to U.S. President Trump, criticized the rule as saying: ¡°The rule has led to the immediate suspension of billions of dollars in U.S. exports, which is at odds with your desire to reduce your trade deficit and increase U.S. global exports.¡±

Jack Colvin also added that if the rule remains unchanged, it will encourage other countries to switch to non-U.S. goods,"which will weaken U.S. national security because other countries and regions in the world, led by China, are eliminating U.S. nodes from their supply chains."

Foreign media said that this letter exposed the strong dissatisfaction of the US private sector with this controversial rule. China hawks in Washington have long tried to pass the rule to crack down on sanctioned Chinese companies using unsanctioned subsidiaries to "circumvent export controls to acquire technology."

In the letter to Trump, the National Foreign Trade Commission also accused the U.S. Department of Commerce of ¡°significantly¡± slowing down or even ¡°temporary¡± stopping processing export license applications, especially for Chinese customers, resulting in ¡°thousands of billions worth of license applications¡± accumulating in the Department of Commerce. Reuters in August that thousands of license applications for U.S. companies to export products and technologies to the world, including China, had stalled due to internal unrest and paralysis.

A spokesman for the Ministry of Commerce of China said on September 29 that the relevant U.S. rules are another typical example of the U.S. side¡¯s widespread national security and abuse of export controls. The U.S. side¡¯s move is extremely harsh, seriously harms the legitimate rights and interests of affected enterprises, seriously impacts the international economic and trade order, seriously undermines the security and stability of the global industrial supply chain, and China firmly opposes this.

Xiang Ligang, chairman of the Zhongguancun Information Consumption Alliance, told the Global Times reporter that the United States has used penetrating rules to cut off the cooperation between Chinese and American technology companies on a wider scale, which will cause the interests of China high-tech companies in the United States with China as an important market. At the same time, it stimulates independent innovation of Chinese technology companies and accelerates the formation of independent industrial chains. This is a result that American companies do not want to see.