US Entity list update, 7 Chinese companies added in relation to quantum
Cryogenics and distributors in, quantum start-ups spared
Late March 2025, the US Bureau of Industry and Security (BIS) added 70 new entities to the entity list1, of those 42 are based in China and 7 were added in connection to quantum technologies. This follows earlier additions of Chinese quantum entities in May 2024 (22 entities) and November 2021 (3 entities), subjecting them to licensing requirements (presumption of denial) for all US exports covered under the Export Administration Regulations (EAR). Effectively, these entities are barred from obtaining any2 goods of US origin or containing US content beyond a de minimus threshold.
Different from past quantum additions which included quantum research institutes and downstream start-ups, the new additions focus exclusively on upstream companies in the quantum supply chain, including in cryogenics and optoelectronics. It also adds two distributors in the business of importing, exporting and servicing scientific instruments and specialized components.
Which companies are added and what are they doing?
The following companies were added in connection to quantum technologies:
Cryogenics
Scikro Instrument (Shanghai/Hong Kong) [赛澔（上海/香港）仪器有限公司]
High-tech enterprise in cryogenic technology. Member unit for a standardization plan on “Ultra-low temperature and ultra-low noise system for superconducting quantum computing.”
Physike Technology [北京飞斯科科技有限公司]
High-tech enterprise specializing in cryogenic equipment and test systems.
Opto-electronics and integrated circuits:
Associated Opto-electronics (Chongqing) [重庆航伟光电科技有限公司]
Produces optoelectronic components, primarily laser diodes and photodiodes. These have many applications beyond quantum, and the quantum connection is not clear to me.3
Chongqing Southwest Integrated Circuit Design [重庆西南集成电路设计有限责任公司]
Again the quantum connection is not quite clear to me. May be related to photonic quantum chips, which are among the priorities in the 14th Chongqing S&TI Five-Year plan.
Both have CETC Chip Technology, one of the quantum additions to the entity list in May 2024, as a large shareholder (in addition to other CETC entities).
Distributors and servicing
Anhui Kehua Sci-Tech Trading [安徽省科华贸易有限责任公司]
Sale and service of scientific equipment in China, official distributor in China of AMPTEK (a US high-tech company in nuclear instrumentation). Has supplied USTC and worked with QuantumCTek, both entities listed for their efforts in quantum technology.
ORICAS Import and Export (Beijing) Corporation [东方科仪控股集团有限公司]
Import, export and service for scientific research institutes. The Chinese Academy of Sciences (CAS) is a main shareholder (indirect).
Why? Cryogenics and other upstream components as a chokepoint
According to BIS, all seven entities “are added for acquiring and attempting to acquire U.S.-origin items in support of advancing China’s quantum technology capabilities, which has serious ramifications for U.S. national security given the military applications of quantum technologies.” More details are given for Scikro, which is alleged to “have a history of supplying dilution refrigerators, which can be used to significantly improve the cooling capabilities of quantum systems, to Chinese parties on the Entity List as well as defense-related Chinese entities.”
Cryogenics, in particular dilution refrigerators, have for a while been considered a “good chokepoint” due to their importance for many (but not all) quantum technologies, which require cooling to near absolute zero. Talk about restricting the export of dilution refrigerators to China surfaced as early as 2019, but the technology was only added to the Commerce Control List in September 2024 (among broad, internationally coordinated export controls on quantum computing). I am doubtful about how effective these restrictions will be, my impression is that quantum researchers in China are generally optimistic that dilution refrigerators will soon be fully localized; media statements often claim this has already happened, for example with the ez-Q fridge by QuantumCTek or SL1000 by OriginQuantum. (I will post a feature translation on the efforts of another cryogenics company, CSSC Pengli Ultracold Technology, soon.)
Beyond just cryogenics, the emphasis on upstream components of the entity list additions is notable. The previous two rounds of entity listings mostly added quantum research institutes and leading full-stack quantum companies (QuantumCTek and OriginQuantum). Some component and instrumentation producers were also added in May 2024, most of them SOEs. The latest additions seem to double down on components and instrumentation, with all seven listed companies connected to enabling technologies and no additional quantum research institutes or quantum startups added.
Additionally, listing two distributors on the entity list is (as far as I know) a first for quantum technology restrictions. Some of these “middlemen” had business relationships with previously listed entities, possibly enabling them to circumvent restrictions, although there is no evidence for this that I am aware of. Their listing could impact the ability of other companies and researchers to acquire components and to service previously bought equipment, including outside of quantum technologies: For example, ORICAS has also supplied equipment to a variety of medical institutes.
Fazit
I don’t think these new quantum additions to the entity list will change much. They appear targeted to tighten existing restrictions on cryogenics and list upstream companies connected to previously listed entities. None of the younger quantum start-ups further downstream was listed. Furthermore, the most important quantum research institutes and companies have already been on the entity list since May 2024. Comprehensive international export controls by the US (November 2024) and others on quantum computing and related components apply to all of China. There is only so much more pain that can be inflicted with additional restrictions.
As I have argued before, existing US controls on quantum technologies are significant, but I doubt that they will contribute much in the long run to their stated goal of maintaining US leadership, and may even be counter-productive.4
To me, the most significant development here is the addition of distributors to the entity list, which could have ramifications beyond quantum technologies.
This is the second post of maybe many from the China ∩ Quantum Substack. Quantum tech in China; what happens where, how does it affect, and is affected by, international developments? Mostly from an S&T innovation policy angle, future posts may also include technical deepdives.
Together with another rule adding 12 entities, none in connection to quantum.
With some exceptions if an agency regulates the items other than the BIS.
A Quantum Information Technology Research Center in Chongqing seems to focus on optoelectronics, so there may be a connection. The company has also supplied components to Huawei.
For various reasons, including the early stage of the technology, the incentives and local networks enabled by the restrictions, and the information costs they impose.