The Non-SDN Chinese Military-Industrial Complex Companies List (NS-CMIC List) is a restricted-party list administered by the U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC) that prohibits U.S. persons from purchasing or selling the publicly traded securities of designated Chinese entities. Its legal foundation is Executive Order 14032, signed by President Joseph R. Biden on June 3, 2021, which amended and superseded Executive Order 13959 issued by President Donald J. Trump on November 12, 2020. EO 13959 had originally created the predecessor "Communist Chinese Military Companies" (CCMC) securities prohibitions, building on the statutory framework of Section 1237 of the National Defense Authorization Act (NDAA) for Fiscal Year 1999 (P.L. 105-261) and Section 1260H of the NDAA for FY 2021. EO 14032 narrowed the regime's focus to the defense and surveillance technology sectors of the People's Republic of China economy and shifted designation authority squarely to Treasury, in consultation with the Departments of State and Defense.
Procedurally, the Secretary of the Treasury identifies entities that operate or have operated in the defense and related materiel sector or the surveillance technology sector of the PRC economy, or that are owned, controlled, or directed by — or themselves own or control — such entities. Upon listing, U.S. persons are prohibited from any "purchase or sale" of publicly traded securities, securities derivative of those securities, or securities designed to provide investment exposure to those securities. The prohibition takes effect at 12:01 a.m. Eastern Time on the date that is 60 days after the entity is listed. A divestment window then runs for 365 days from the date of listing, during which U.S. persons may sell or transfer covered securities solely to wind down existing positions. After that window closes, U.S. persons may neither buy nor sell — they may only continue to hold legacy positions in a passive capacity, subject to corporate actions specifically authorized by OFAC General Licenses.
The prohibition is "investment-only" in character: unlike a Specially Designated Nationals (SDN) listing, an NS-CMIC designation does not freeze assets, does not block U.S.-dollar correspondent banking, and does not prohibit commercial trade, licensing, employment, or ordinary-course payments with the listed entity. Subsidiaries are captured through a name-matching rule rather than the 50 Percent Rule that governs SDN entities: under OFAC FAQ guidance, restrictions extend to any subsidiary whose name closely matches the name of a listed entity, with such subsidiaries being formally added to the list following a public comment process. Market-making activities, certain underwriting functions, and clearing operations are addressed through a series of OFAC General Licenses, while ancillary services such as research publication and index inclusion have been governed by FAQs issued under the Chinese Military-Industrial Complex Sanctions Regulations codified at 31 C.F.R. Part 586.
The inaugural Annex to EO 14032 named 59 entities, including China Aerospace Science and Industry Corporation (CASIC), China Aviation Industry Corporation (AVIC), China Electronics Technology Group Corporation (CETC), China General Nuclear Power Corporation, China Mobile Communications Group, China Telecommunications Corporation, and surveillance-technology firms Hangzhou Hikvision Digital Technology and Zhejiang Dahua Technology. Subsequent Treasury actions have added entities including, in 2022, China Communications Construction Company subsidiaries, and continuing additions tied to Beijing's military-civil fusion program and Xinjiang surveillance infrastructure. The New York Stock Exchange delisted the American depositary receipts of China Mobile, China Telecom, and China Unicom in January 2021 pursuant to the predecessor EO 13959, and MSCI, FTSE Russell, and S&P Dow Jones removed affected securities from their global indices during 2020–2021.
The NS-CMIC List should be distinguished from several adjacent regimes. It is not the SDN List, which imposes full blocking sanctions under the International Emergency Economic Powers Act (IEEPA); NS-CMIC listings carry no asset freeze. It is separate from the Department of Commerce Entity List, administered by the Bureau of Industry and Security under the Export Administration Regulations, which restricts exports of U.S.-origin items but not securities transactions. It is also distinct from the Department of Defense Section 1260H List of "Chinese Military Companies," which is a reporting and reputational designation without direct securities consequences, though 1260H listings frequently inform Treasury's NS-CMIC determinations. Finally, NS-CMIC differs from the Public Company Accounting Oversight Board's Holding Foreign Companies Accountable Act regime, which addresses audit inspection rather than ownership.
Litigation has tested the regime's contours. In Xiaomi Corp. v. Department of Defense (D.D.C. 2021), the U.S. District Court for the District of Columbia preliminarily enjoined Xiaomi's CCMC designation under the predecessor order, leading DoD to remove the company; the case prompted Treasury to refine the evidentiary record supporting EO 14032 listings. Luokung Technology Corp. obtained similar relief. Controversies persist over the scope of "closely matches" for subsidiary capture, over whether passive index exposure through non-U.S. funds available to U.S. retail investors evades the prohibition, and over the treatment of convertible instruments and depositary receipts. The Biden administration's 2023 Outbound Investment Executive Order on semiconductors, quantum, and AI overlaps thematically but operates under a separate notification-and-prohibition architecture administered by Treasury's Office of Investment Security.
For the practitioner, the NS-CMIC List is the principal U.S. capital-markets instrument for pricing strategic competition with the PRC. Compliance officers at U.S. asset managers, broker-dealers, pension funds, and index providers must screen holdings against the list continuously; corporate counsel advising on cross-border M&A must assess whether target portfolios contain restricted securities; and diplomats and analysts must read each new Treasury announcement as a signal of how Washington is calibrating economic statecraft toward Beijing short of the more disruptive SDN designation. Mastery of the regime's narrow but expanding perimeter — investment-only, sectorally bounded, subsidiary-sensitive — is now a baseline competency in U.S.-China policy work.
Example
On June 3, 2021, President Biden signed Executive Order 14032, establishing the NS-CMIC List with 59 inaugural entities including CASIC, AVIC, Hikvision, and Dahua, prohibiting U.S. persons from transacting in their publicly traded securities.