On 23 July 2021, China’s Ministry of Commerce (the “MOFCOM”) issued a proposed revision to the Catalogue of Technologies Subject to Import Prohibition or Restriction (中国禁止进口限制进口技术目录) (the “Catalogue”) for public comments. This revision is intended to promote a healthy and business-friendly environment for trade in technologies and significantly reduces the list of technologies prohibited or restricted for import into China. The current version of the Catalogue contains 87 items subject to import restrictions and 39 items subject to import prohibitions which have been reduced to 14 items subject to import restriction and 10 items subject to import prohibition under the proposed revised Catalogue.

Nonetheless, despite the overall reduction in prohibited and/or restricted technologies, the revised Catalogue has notably included “encryption software employing a key length greater than 256 bits (高于256位加密的加密软件)” to the list of Technologies subject to Import Restriction. Once the revised Catalogue has been approved, businesses will need to apply for import permits before importing any encryption software employing a key length greater than 256 bits into China.

Companies employing strong encryption are likely to be impacted and should closely keep track of the above development to prepare for the change in regulatory requirements in a timely manner.

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