In a sprawling shopping centre in Beijing’s Chaoyang district, Calvin Klein and Tommy Hilfiger stores sit eerily empty on a workday lunchtime, their quiet storefronts a ghostly reflection of China’s broader consumption slowdown.
But an even darker shadow has been cast over the American clothing brands in China, with their parent company, PVH, landing on a blacklist after being caught up in tit-for-tat trade sanctions.
China’s Ministry of Commerce placed PVH on its Unreliable Entity List (UEL) on Tuesday, along with American genetic testing company Illumina. The UEL is a blacklist similar to the United States’ entity lists, which restrict foreign companies’ access to US technology and their ability to do business with US companies.
Do you have questions about the biggest topics and trends from around the world? Get the answers with SCMP Knowledge, our new platform of curated content with explainers, FAQs, analyses and infographics brought to you by our award-winning team.
The move was among a raft of countermeasures put in place by China after US President Donald Trump levied an additional 10 per cent tariff on Chinese imports, citing concerns about the country’s alleged role in producing precursor chemicals for fentanyl, a deadly synthetic opioid used as a recreational drug that claims tens of thousands of American lives a year.
China’s response also included tariffs of 10 to 15 per cent targeting select US goods, export controls on an array of critical minerals, and an antitrust investigation into Google.
“China is completely reactive, and will revoke these measures if Mr Trump walks back from his fentanyl-related tariffs,” said Xu Tianchen, a senior China economist with the Economist Intelligence Unit.
The Ministry of Commerce said PVH and Illumina had “violated normal market transaction principles by unilaterally cutting off normal business dealings with Chinese companies and imposing discriminatory measures, severely harming the legitimate rights and interests of Chinese enterprises”.
The announcement did not detail the measures that would be taken against the two companies. Penalties could include fines, restrictions on employee travel, and suspension of exports from China.
Calvin Klein China did not respond to a request for comment.
Staff at the Calvin Klein store in Chaoyang’s Solana shopping centre said they could not comment on the UEL decision. A cashier at the Tommy Hilfiger store next door said she had not heard about the blacklist and that all stores in China were operating normally.
Calvin Klein and Tommy Hilfiger have a presence in major Chinese cities, and their parent’s inclusion on the blacklist does not yet appear to have prompted a major backlash against the US clothing brands among the country’s consumers.
Xu said the UEL does not say whether subsidiaries of blacklisted foreign entities will also face sanctions, but it was highly likely that they would.
“Even if CK and Tommy Hilfiger are not directly sanctioned, Chinese manufacturers may proactively sever ties with them,” he said. “This is similar to how many Western companies voluntarily exited the Russian market after the outbreak of the Russia-Ukraine conflict, as businesses often ‘over-comply’ to mitigate risk.”
In the meantime, foreign companies may face more difficulties when trying to navigate conflicting regulatory requirements in the US and China, he added.
The probe into PVH started in September last year, after it refused to source cotton from China’s Xinjiang Uygur autonomous region. Cotton production in the region has been in the global spotlight since 2020 when several US and European clothing brands, including Adidas, Nike and H&M, raised concerns about allegations of forced labour in the industry.
PVH earned 6 per cent of its revenue and 16 per cent of its profit from China in 2023, CEO Stefan Larsson said during the company’s latest earnings call.
More from South China Morning Post:
- China’s first counter-sanction on US biotech industry marks a turning point in tech war
- How is China retaliating against US tariffs, and what impact will it have?
- Chinese firms turn to US courts to fight sanctions, one case at a time
- China hits back at US curbs with multifront probes into American firms
- China raises Xinjiang cotton with parent firm for Calvin Klein and Tommy Hilfiger
For the latest news from the South China Morning Post download our mobile app. Copyright 2025.
