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Just after President Donald Trump's 10% tariffs on all goods imported into the U.S. from China went into effect on Tuesday, the Ministry of Commerce of the People’s Republic of China made a shocking announcement that accused a well-known American clothing company of willingly committing harmful actions against the country.
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This jaw-dropping announcement could potentially lead to more American companies landing in the same detrimental position since China has already started investigations against other U.S.-based companies.
Related: Major tequila company makes huge tariff announcement
Even though this is the first officially reported incident post-Trump tariffs implementation, it raises the question of whether it could signal the beginning of several forms of retaliation from China against the U.S.
China's Ministry of Commerce blacklists PVH from doing business in its country
The Ministry of Commerce of the People’s Republic of China announced that the American company PVH had been placed on the country's "Unreliable Entity List," essentially blacklisting it.
PVH Corp. (PVH) is an American clothing company that owns Tommy Hilfiger and Calvin Klein brands.
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According to the Xinhua news agency, China's Ministry of Commerce released a statement on Tuesday claiming that PVH had "violated normal market trading principles, terminated regular trade with Chinese companies, and adopted discriminatory measures against Chinese companies, thus severely harming their legitimate rights and interests."
Although the exact implications of this harsh decision have yet to be announced for PVH specifically, it could affect the company's finances and future investments in the country since it can potentially restrict exports and imports, ban the company from conducting business in China, or lead to fines and other penalties.
As stated in the Provisions on the Unreliable Entity List of China's Ministry of Commerce, these provisions are stipulated in accordance with China's Foreign Trade Law, its National Security Law, and other relevant laws to "safeguarding national sovereignty, security and development interests, maintaining fair and free international economic and trade order, protecting the legitimate rights and interests of enterprises, other organizations, and individuals of China."
The U.S. signs a law to ban imports from China's Xinjiang region over forced labor concerns
In 2021, Former President Joe Biden signed the Uyghur Forced Labor Prevention Act that banned imports from China's Xinjiang region because it posed labor concerns that abused human rights. This act aims to prevent forced labor-made goods from entering the U.S.