Two Chinese companies included.. US sanctions target arms smuggling and purchasing networks for the Houthi militia in Yemen

The United States on Wednesday imposed sanctions on two Chinese companies for supporting the Houthis with “arms smuggling and procurement,” the latest attempt by President Joe Biden’s administration to deter the armed group that has carried out a series of ongoing attacks in the Red Sea.

The sanctions were part of a larger tranche that also targeted another company and one individual for helping to smuggle Houthi weapons, and one entity and two vessels linked to Houthi and Iranian commercial shipments.

According to the US Treasury, the Houthis “purchased tens of thousands of dollars’ worth of dual-use components” from a Chinese company, “which Houthi forces have used to bolster domestic missile and UAV production efforts.”

The Yemen-based armed group has obtained “key components for use in the development and manufacture of missiles and drones” from the second Chinese company, which was sanctioned in July for supporting Iran’s defense ministry and armed forces logistics.

“These facilitators and suppliers have enabled the terrorist group to obtain dual-use and military-grade materials and components necessary to manufacture, maintain, and deploy advanced missiles and unmanned aerial vehicles that threaten the interests of the United States and our allies,” State Department spokesman Matthew Miller said in a statement Wednesday.

Text of the US Treasury statement :

The US Treasury Department's Office of Foreign Assets Control has designated an individual and three companies for facilitating the purchase and smuggling of weapons to the Ansar Allah, known as the Houthis.

This action targets key customers and suppliers in Iran and the People’s Republic of China who have enabled the Houthis to obtain dual-use materials and components necessary to manufacture, maintain, and deploy an arsenal of advanced missiles and unmanned aerial vehicles against U.S. and allied interests.

Additionally, OFAC imposed sanctions on one entity and two vessels linked to illicit Houthi and Iranian commercial shipments, including a vessel that transported shipments on behalf of Houthi financial official Saeed al-Jamal and an affiliate of the Iranian Armed Forces General Staff.

“The Houthis continue to leverage their networks of businesses and procurement officials to support their reckless attacks on civilian vessels, their unarmed crews, and the civilian population,” said Acting Under Secretary of the Treasury for Terrorism and Financial Intelligence Bradley T. Smith.

“Treasury remains committed to using the full range of tools to disrupt the supply chain networks that enable the Houthis’ destabilizing activities,” he added.

Today’s action comes under Executive Order 13224, Counterterrorism, as amended, and builds on OFAC’s actions of June 17, 2024, and July 31, 2024, targeting Houthi arms suppliers and agents based in Yemen, the People’s Republic of China, Hong Kong, and the Sultanate of Oman.

The U.S. Department of State designated Ansar Allah as a Specially Designated Global Terrorist under Executive Order 13224, as amended, effective February 16, 2024, for having committed, attempted to commit, poses a significant risk of committing, or engaged in training for the commission of acts of terrorism.

Shipping broker linked to Houthis

The Houthis use a network of international shipping and logistics companies to transport military components from third-country suppliers to their forces in Yemen. Shenzhen Boyu Imports and Exports Co., Limited (Shenzhen Boyu ) is an international logistics and shipping company based in the People’s Republic of China that has facilitated multiple shipments of dual-use components for use in weapons production for the Houthi militants.

Houthi logistics operatives have used Shenzhen Boyu to move these important dual-use and military items via trade routes in an attempt to evade the embargo.

Shenzhen Boyu is being designated pursuant to Executive Order No. 13224, as amended, for having materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services to or in support of, Ansar Allah.

Suppliers in China

Houthi procurement clients continue to obtain dual-use components and other military-grade items from a range of companies based in the People’s Republic of China.

The Houthis have obtained tens of thousands of dollars’ worth of dual-use components from the People’s Republic of China-based Shenzhen Jinghon Electronics Limited (Shenzhen Jinghon ), which Houthi forces have used to bolster domestic missile and drone production efforts.

Shenzhen Rayon Technology Co., Ltd., based in the People’s Republic of China, is another entity from which the Houthis have obtained key components for use in the development and manufacture of missiles and drones. Shenzhen Rayon has shipped numerous military components to Houthi clients in Yemen, including hundreds of advanced components for use in the manufacture of missile guidance systems.

Shenzhen Rion Company was previously designated pursuant to EO 13382 on July 30, 2024 for having provided, or attempted to provide, financial, material, technological, or other support for, or goods or services in support of, the Iranian Armed Forces’ Defense and Logistics Authority.

Shenzhen Jinghun and Shenzhen Rion are being designated pursuant to Executive Order 13224, as amended, for having materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services to or in support of, Ansar Allah.

Houthi smuggling agent

Houthi operatives based in Iran and elsewhere operate a range of supply chains and smuggling networks to move dual-use items and other lethal aid into Houthi-controlled territory.

Hasan Ahmed Hasan Mohammed al-Kahlani (Hassan al-Kahlani), who resides in Iran, has facilitated Houthi arms smuggling efforts. Hasan al-Kahlani has also coordinated the concealment and transfer of Iranian lethal aid to Houthi forces.

Hassan Al-Kahlani is being designated pursuant to Executive Order 13224, as amended, for acting or purporting to act for or on behalf of, directly or indirectly, Ansar Allah.

Oil shipments

The Gabon-flagged cargo vessel Izumo ( IMO: 9249324 ) is currently transporting petroleum products on behalf of a sanctioned Iranian Armed Forces General Staff ( AFGS ) front company, Sepehr Energy Jahan Nama Pars.

The cargo ship Izumo also transported petroleum products on behalf of the network of sanctioned Houthi financial official Saeed al-Jamal. Saeed al-Jamal’s network has provided tens of millions of dollars in illicit oil sales to support Houthi attacks on commercial shipping in the Red Sea.

The IZUMO is owned, managed and operated by Gemini Marine Limited, a Marshall Islands-registered company. Gemini Marine Limited also owns the Cook Islands-flagged crude oil tanker FRUNZE ( IMO: 9263643 ). The FRUNZE has been linked to the illicit transport of Iranian oil, and both vessels have been linked to illicit Russian oil shipments.

Gemini Marine Limited is being designated pursuant to E.O. 13224, as amended, for having materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services to or in support of, Sepehr Energy Jahan Nama Pars . IZUMO and FRUNZE are being identified as property in which Gemini Marine Limited has an interest.