China has imposed sanctions on 20 U.S. defense-related companies and 10 senior executives in retaliation for the United States' approval of an $11.1 billion arms sale package to Taiwan—the largest in U.S. history. The measures, announced by China's Ministry of Foreign Affairs on December 26, 2025, include freezing assets held in China, prohibiting Chinese entities from conducting business with the sanctioned parties, and barring the executives from entering mainland China, Hong Kong, and Macau.
Sanctioned companies include Boeing's defense unit in St. Louis (focused on military aircraft), Northrop Grumman Systems Corporation, L3Harris Maritime Services, and others such as Anduril Industries. Among the executives is Palmer Luckey, founder of Anduril Industries. Many of these firms have limited or no commercial operations in China, rendering the sanctions largely symbolic but signaling Beijing's strong opposition.
China's foreign ministry described the U.S. arms sales as a "flagrant violation" of the one-China principle and the three Sino-U.S. joint communiqués, accusing Washington of interfering in internal affairs and undermining sovereignty. "Any company or individual who engages in arms sales to Taiwan will pay the price for the wrongdoing," a spokesperson stated, emphasizing that the Taiwan question is a "red line" in bilateral relations.
The sanctions follow the Trump administration's notification to Congress on December 17-18, 2025, of the $11.1 billion package, comprising advanced systems like High Mobility Artillery Rocket Systems (HIMARS), Army Tactical Missile Systems (ATACMS), self-propelled howitzers, Javelin and TOW missiles, drones, and tactical network software. The Pentagon described the sales as supporting Taiwan's self-defense and regional stability.
The U.S. State Department "strongly objected" to the sanctions, urging China to cease military, diplomatic, and economic pressure on Taiwan and engage in dialogue instead.
Taiwan welcomed the package, viewing it as bolstering deterrence against Chinese threats. Beijing has refused to rule out force for unification, conducting frequent military drills around the island.
This escalation highlights persistent U.S.-China tensions over Taiwan, a core issue in relations. While symbolic, the sanctions underscore Beijing's resolve amid Trump's return to office and signals of firmer Taiwan support.
