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Selling to China or Hong Kong? UK sanctions end-use controls and buyer checks (2026)

Last updated: · By Sarah Liu, Thornfield Resources

Short answer: since 13 May 2026, a UK exporter needs a licence to send goods that are not otherwise export-controlled to a third country such as China or Hong Kong if the government has formally told it, in writing, that the goods are at risk of diversion to Russia or another sanctioned destination. This sanctions end-use control (SEUC) was introduced by the Sanctions (EU Exit) (Miscellaneous Amendments) Regulations 2026 (SI 2026/443). Notices come from the Office of Trade Sanctions Implementation (OTSI) or through HMRC, and OTSI handles the licence. It is not a blanket licence requirement, but UK guidance names China, including Hong Kong and Macau, as a destination needing enhanced due diligence, so check the buyer and keep written records.

What is the UK sanctions end-use control?

It is a targeted licence requirement that switches on only when the government tells a specific exporter about a specific export. The Department for Business and Trade's OTSI published guidance for businesses on 22 April 2026, and the rules applied from 13 May 2026.

PointWhat the rules say
Goods coveredGoods and related technology not already controlled as military, dual-use or WMD items, typically ordinary commercial and industrial goods
DestinationsNon-sanctioned third countries, such as China, Hong Kong, Türkiye or the UAE, where there is a risk of onward diversion
Sanctions regimesBelarus, Iran, Iran (Nuclear), Libya, Myanmar, North Korea, Russia (including non-government-controlled areas of Ukraine), Somalia, Syria, Venezuela and Zimbabwe. Russia is the main driver.
TriggerA formal written notice that the export may be intended, directly or indirectly, for a sanctioned destination or a person connected with one
ConsequenceExporting the notified goods without a licence is a criminal offence

The existing sanctions still apply in full. Supplying restricted goods to Russia indirectly through a buyer in China is already prohibited, whether or not you have received a notice.

When do you need a licence?

Only after you have been informed in writing. OTSI is not accepting advance or speculative SEUC licence applications, so you cannot apply just in case.

  1. You receive a notice: usually through HMRC's National Clearance Hub when goods are declared, or by direct contact from OTSI. It identifies the shipment or transaction and says a licence is needed.
  2. Stop the export: do not ship or transfer the notified goods or technology.
  3. Decide whether to apply: at the border, goods may be detained pending a decision, or returned to you if you undertake not to export them to that destination without a licence.
  4. Apply to OTSI: with evidence on the end user, the end use, the route and supply chain, and the due diligence you did.
  5. Wait for the decision: applications are assessed case by case, looking at the goods, the diversion risk of the customer, route and end user, your compliance history and due diligence, and government intelligence. A licence may be granted with conditions, or refused.

Who is notified, and who do you contact?

Under the SEUC the government notifies you, not the other way round. Which body you deal with depends on the question.

BodyRole for exporters to China and Hong Kong
OTSI (Department for Business and Trade)Issues SEUC notices, decides SEUC licences, licenses sanctioned goods since 27 April 2026, and imposes civil penalties
HMRC and Border ForceDetain goods at the border; HMRC handles criminal enforcement of export sanctions
Export Control Joint Unit (ECJU)Licences for goods on the strategic control lists, including those also subject to sanctions. Email exportcontrol.help@businessandtrade.gov.uk or call 020 7215 4594

A different rule applies to weapons of mass destruction. If you know or suspect that any item, even an uncontrolled one, may be used for WMD purposes, GOV.UK says you have a legal obligation to notify ECJU and apply for a licence.

Why are China and Hong Kong treated as high-risk destinations?

Because they are major routes for goods reaching Russia through intermediaries. The government's guidance on countering Russian sanctions evasion, first published in January 2025, lists countries where exporters of at-risk goods should carry out enhanced due diligence, and the list includes "China, including Hong Kong and Macau", alongside India, Kazakhstan, Türkiye, the UAE, Vietnam and others. The list is not exhaustive.

Risk also depends on the product. Law firm summaries of the SEUC guidance describe a higher-risk list that includes industrial machinery, motor vehicles, pumps, semiconductors and computer monitors. The Common High Priority List covers items found in Russian weapons systems, such as integrated circuits and radio modules. Selling these to a reseller in Hong Kong deserves far more scrutiny than selling consumer goods to a named Chinese retailer.

What are the red flags for diversion?

The OTSI guidance groups warning signs by product, customer, transaction and destination. Pause and investigate if you see any of these:

  • Product does not fit the buyer: the item does not match the buyer's line of business or the technical level of the destination.
  • Hidden end user: the buyer will not say who will use the goods, or documents do not name the actual end user.
  • Mismatched locations: the order comes from one country and the stated end user is in another.
  • Unusual payment: unusual terms, amounts or routes, or payment from a third-country company unrelated to the deal.
  • Odd routing: an abnormal shipping route, or transit through a country on the enhanced due diligence list.
  • Ownership changes: a change of owner or structure around the time sanctions were imposed.
  • No aftercare wanted: the buyer declines routine installation, training or maintenance.
  • Poor paperwork: false, inaccurate or missing trade, financial or supporting documents.

How do you check a Chinese or Hong Kong buyer?

  1. Mainland registry: search the 18-character Unified Social Credit Code on the National Enterprise Credit Information Publicity System (gsxt.gov.cn). Check the legal name in Chinese, status, date set up, shareholders and business scope. A scope limited to trading, for a buyer claiming to use the goods itself, needs explaining.
  2. Hong Kong registry: search the Companies Registry e-Services Portal. A company particulars search costs HK$22 and annual return copies cost about HK$16–23 each, which show directors and shareholders.
  3. Sanctions screening: screen the buyer, its owners, directors, bank and freight forwarder against the UK Sanctions List, which has been the only source for UK designations since 28 January 2026.
  4. Courts and enforcement: check China Judgements Online and the China Enforcement Information Disclosure site for disputes and defaulter listings.
  5. End-user statement: get a signed statement naming the end user, the end use and the final destination, and check it against the registry.
  6. Contract terms: UK law does not require a "no Russia" clause, but OTSI publishes a template. It covers a promise not to re-export to Russia, a duty to report problems and a duty to provide compliance information within two weeks of request.
  7. Payment: accept payment only from the buyer's own account, in its registered name. Ask why if a third party pays.

What records should you keep, and what are the penalties?

OTSI's guidance says written records of due diligence should be maintained. In practice that means keeping the registry extracts, screening results, end-user statements, contracts, payment records, any notice you receive and all correspondence with OTSI or HMRC. Separately, HMRC requires you to keep evidence of export for six years to support VAT zero-rating.

The consequences of getting it wrong include detention or seizure of goods, refusal or revocation of licences, public naming, and criminal prosecution. Since 10 October 2024, OTSI can impose civil penalties on a strict liability basis, up to the greater of £1 million or 50% of the value of the breach, so it does not need to prove you knew.

How can Thornfield help?

Thornfield Resources is a London company (Companies House 17162127) that works in English and Mandarin. We can read a Chinese buyer's registry, ownership and court records in Chinese, using the same method as our supplier checks, and explain what we find through China advisory at £250. We are not a law firm or an export licensing adviser. Whether you need a licence, and how to apply, is a question for ECJU, OTSI or a sanctions lawyer. Contact us with the buyer's name for a scope and price.

Common questions

Do I need an export licence to sell to China after 13 May 2026?

Not because of the sanctions end-use control alone, unless the government has formally informed you in writing about that export. Goods on the strategic control lists may need a licence anyway, so check the control lists or ask ECJU.

Can I apply for a sanctions end-use licence in advance?

No. OTSI says it is not accepting advance SEUC applications, so you apply only after you receive a notice.

Does the end-use control apply to Hong Kong?

It can apply to exports to any non-sanctioned country, including Hong Kong. UK guidance treats China, including Hong Kong and Macau, as a destination needing enhanced due diligence for at-risk goods.

What happens if my goods are stopped at the border?

Goods may be detained while a licence application is decided, or returned to you if you undertake not to export them to that destination without a licence. Being stopped at the border is not itself an offence; exporting after being informed, without a licence, is.

Do I have to tell the government if I suspect diversion?

The SEUC itself does not create a general duty to report, but you should not proceed while red flags are unresolved, and a WMD concern must be notified to ECJU. Take advice from a sanctions lawyer before deciding what to report.

Is a "no Russia" clause enough protection?

No. It can reduce risk, but OTSI's guidance says it does not replace due diligence on the buyer.

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