China's Ministry of Commerce (MOFCOM) has launched an investigation into U.S. company PVH under the Unreliable Entity List (UEL) for suspected violation of normal market trading principles regarding products related to Xinjiang, suspending normal transactions with Chinese firms, organizations and individuals, and adopting discriminatory measures, along with other issues. PVH, the parent company of Calvin Klein and Tommy Hilfiger, must provide documentation and evidence within 30 days regarding whether it has taken discriminatory measures against Xinjiang-related products over the past three years, MOFCOM said in a statement. The Ministry said that the U.S. firm is suspected of violating normal market trading principles, and boycotting cotton and other products from Xinjiang without a factual basis.
The measures taken by PVH have seriously undermined the legitimate rights and interests of Chinese enterprises and jeopardized China's sovereignty, security and development interests, according to MOFCOM, adding that it has always prudently handled the Unreliable Entity List while targeting only a very small number of foreign entities that have violated market rules and Chinese laws. The Ministry added that foreign entities obeying Chinese laws do not have to worry about the list.
Global enterprises operating in China have to obey Chinese regulations, including the non-discriminatory treatment of products and enterprises from different places, which is an important foundation for establishing the Unreliable Entity List system, Zhou Mi, Senior Research Fellow at the Chinese Academy of International Trade and Economic Cooperation, told the Global Times. If put on the UEL, the company would be banned from trading with or investing in China and its executives would also be banned from visiting China. A company representative said that “as a matter of company policy, PVH maintains strict compliance with all relevant laws and regulations in all countries and regions in which we operate”.
