Yangzhou Yangjie Electronic manufactures diodes and transistors used in automotive electronics worldwide. The company was included in the EU's 20th sanctions package against Russia as a supplier of dual-use components. However, just the next day after the package was announced, an EU Commission spokesperson confirmed to Reuters that the Commission was simultaneously proposing a nine-month exemption for the same company to member states.

Why automakers became hostages

Yangzhou Yangjie is not a marginal supplier. The company is part of several global supply chains for Bosch, Continental, and other Tier-1 automotive suppliers. An abrupt refusal to use its products without a transition period threatens shutdown of production lines at factories in Germany, France, and the Czech Republic — precisely what the Commission calls "serious disruptions."

According to the EU Commission spokesman, nine months should give manufacturers time to find alternative suppliers of similar semiconductors — primarily in Japan, South Korea, or among European producers.

"The exemption does not mean lifting sanctions. The company remains on the list, and deals with it after the transition period would violate EU law."

EU Commission Spokesman, Reuters

Unanimity — the main trap

The exemption requires unanimous approval from all 27 EU member states to take effect. This is the same procedure that has already slowed down or diluted sanctions decisions several times: a single veto is enough — and the exemption does not apply, leaving automakers facing a tough deadline without legal certainty.

Economist at the Kyiv School of Economics Yuriy Haidai notes that such "technical exemptions" represent a systemic vulnerability in the EU's sanctions architecture: the more integrated the supply chain, the more painful the disruption — and the stronger the lobbying pressure for an exemption. According to him, Chinese component manufacturers understand this and deliberately build their presence in critical sectors.

What this means for sanctions pressure on Russia

Yangzhou Yangjie Electronic was added to the list because its components were found in Russian military equipment, including fragments of Iranian Shahed drones, according to Conflict Armament Research analysts. The nine-month pause does not cancel this fact — but it gives the company time to continue operating in a "gray zone" until the restrictions fully take effect.

• 20th sanctions package — the most comprehensive in terms of number of entities sanctioned since the start of the full-scale invasion
• Yangzhou Yangjie — one of the first Chinese semiconductor companies subject to direct EU sanctions
• Nine months — the standard transition period the EU previously applied to energy contracts

If even one EU member state blocks the exemption, automakers will get not nine months but several weeks — precisely until the date the main package takes effect. Whether Berlin and Paris are willing to take such a risk for the sake of sanctions consistency will become clear at the upcoming meeting of the EU Council on Foreign Affairs.