The Trump administration has included Hong Kong's Government Flying Service (GFS) on a blacklist of Chinese and Russian entities with alleged military ties that restricts them from buying a wide range of US goods and technology.
The list includes 58 Chinese entities and 45 tied to Russia. A subsidiary of Hutchison China, Hutchison Optel Telecom Technology, is also among them.
Commerce Secretary Wilbur Ross said the blacklist action establishes a new process "to assist exporters in screening their customers for military end users."
Around 300 civil servants work at the GFS – which replaced the Royal Hong Kong Auxiliary Air Force in 1993 – with its aircraft used for search and rescue, firefighting, as an air ambulance service, and law enforcement operations.
Pro-democracy activists recently claimed that the GFS had tracked the 12 young Hongkongers who were detained by the Guangdong coast guard in August, allegedly as they were trying to flee to Taiwan.
The authorities neither confirmed nor denied the claim, although for their part, the police insisted that they had played no role in the group's arrest.
Publishing the list in the waning days of the Trump administration follows the addition of dozens of Chinese companies to another US trade blacklist, including the country's top chipmaker, SMIC, and Chinese drone manufacturer SZ DJI Technology, on Friday.
Tensions between Washington and Beijing have escalated over the past year, as Trump blamed China for the coronavirus pandemic and condemned the national security law imposed in Hong Kong.
The US government also has grown increasingly concerned about China’s “military-civil fusion,” a policy that aims to build up its military might and technological development in tandem.
Last spring, the Commerce Department expanded the definition of "military end users," as the department defines the companies with military ties.
The category includes not only armed service and national police, but any person or entity that supports or contributes to the maintenance or production of military items - even if their business is primarily non-military.
The "military end user" designation requires US companies to obtain licences to sell to the firms, which are more likely to be denied than granted.
The list is not definitive and Commerce said US companies must continue to do their own due diligence to help decide whether their buyers are considered military end users.
Publication of the list is likely to inflame Beijing. Foreign Ministry spokesman Zhao Lijian in November called news of the draft list "unprovoked suppression of Chinese companies by the United States." (Additional reporting by Reuters)