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China sanctions Northrop Grumman, Lockheed Martin for arms sales to Taiwan

FILE PHOTO: Lockheed Martin's logo is seen during Japan Aerospace 2016 air show in Tokyo

By Joe Cash and Liz Lee

BEIJING (Reuters) -China will impose sanctions against U.S. aerospace and defence firms Northrop Grumman and Lockheed Martin for providing weapons to Taiwan, the Chinese foreign ministry said on Friday.

The sanctions are being enacted under China's Anti-Foreign Sanctions Law, ministry spokesperson Mao Ning told a regular press briefing.

"We urge the U.S. side to effectively abide by the one-China principle... cease U.S.-Taiwan military liaison and stop arming Taiwan, or else it will be subject to a resolute and forceful retaliation by the Chinese side," she said.

Mao named Lockheed Martin Corp's branch in Missouri as the prime contractor that was directly involved in an arms sale to Taiwan on Aug. 24 and said Northrop Grumman has repeatedly participated in the sale of weapons to Taiwan.

China has applied sanctions on U.S. companies over selling weapons to Taiwan on numerous occasions before, and it is not immediately clear how they work or what they are intended to achieve given that neither company sells to China.

U.S. President Joe Biden last month approved the transfer of up to $80 million in funds to Taiwan under the Foreign Military Financing programme, according to a notification sent to Congress.

The sanctions were imposed during a week of busy military activity around the democratically-governed island, in which a Chinese naval formation led by the aircraft carrier Shandong passed within 60 nautical miles (111 km) of Taiwan's southeast.

Taiwan has also reported dozens of Chinese fighters, bombers and other aircraft flying into its air defence zone this week.

Beijing views the self-ruled island of Taiwan as a breakaway province that must accept Chinese sovereignty and has never renounced the use of force to achieve that goal.

China's wide-ranging law to counter foreign sanctions came into force in 2021 in an apparent move to legalise tit-for-tat retaliation against punitive actions taken by foreign countries.

It has extraterritorial reach and is part of a suite of laws Beijing has introduced in recent years that analysts say may enable China to police countries' behaviour towards it beyond its shores.

(Reporting by Joe Cash, Liz Lee and Beijing newsroom; Editing by Kim Coghill and Christian Schmollinger)