China Blacklists Calvin Klein, Tommy Hilfiger Amid Trade War With US

Tommy Hilfiger and Calvin Klein have been caught in the crossfire of a trade war between the United States and China. PVH, the parent company of the two American apparel brands, was added to China's Ministry of Finance's "unreliable entities list" on Tuesday.

In a statement, a Chinese Ministry of Commerce spokesperson said that it found PVH discriminated against and obstructed the activities of Chinese companies. The spokesperson refused to offer any other specific reason for PVH's addition to the list.

While Beijing formally placed PVH on its blacklist on Tuesday, the Chinese Ministry of Commerce had already started looking into the company in September for reportedly refusing to source cotton from the Xinjiang province from where reports of discrimination against and oppression of Uyghur Muslims surfaced.

The announcement came just days after US President Donald Trump imposed a 10% tariff on Chinese imports. China took several other retaliatory actions against the United States such as additional taxes on farm equipment and energy imports and an antitrust investigation into Google.

"There's this tit-for-tat trade war going on, and [China] wants to show the United States that it's going to take action to hurt either big US companies or companies with significant interests in the US," said Michael Kaye, a partner at Squire Patton Boggs, who has been practising international trade law for more than 30 years.

He added, "They're being made an example. ... My guess is, (China) wanted to pick somebody and they wanted it to be somebody that was high visibility."

Now that PVH has been put on the unreliable entities list, China can force it to close the dozens of stores it runs in the area and prohibit it from selling its products to Chinese customers online. The country can also fine the retailer, prohibit import and export, revoke their employees' work permits and deport them back home.

PVH has criticised the decision and said it would work with Chinese authorities to resolve the issue.