On October 9, 2025, China’s Ministry of Commerce issued MOFCOM Notice 61, among the most aggressive extraterritorial export control measures ever applied to a raw material. It mirrors the architecture of the US Foreign Direct Product Rule applied to advanced technology, but applies that architecture to rare earth content in physical goods for the first time. It introduced a 0.1% de minimis rule: any product manufactured outside China that contains Chinese-origin rare earth elements at 0.1% or more of the product’s value requires a Chinese government export licence before it can be shipped to another country. The trigger is at the component level, not the finished product level. An NVIDIA H200 server assembled in Taiwan has a CIF value of several hundred thousand dollars. The rare earth content of its cooling fan magnets as a percentage of total server value is almost certainly below 0.1%, meaning the complete server does not trigger the licence requirement. But the permanent magnets inside those cooling fans, the sputtering targets used in its chip manufacturing process, and the HDD storage magnets traded as components at component-level pricing easily exceed 0.1% rare earth value. The permit requirement attaches to the component at the point of transfer, not to the finished system at the point of final import. On November 7, 2025, MOFCOM suspended Notice 61 until November 10, 2026 as part of a temporary de-escalation agreement. That suspension gives every importer of AI hardware, advanced electronics, and industrial equipment exactly six months to understand what November 10 means for their supply chain and build the compliance infrastructure to survive it. This guide covers what China rare earth export controls 2026 actually require, which products are affected, what the November 10 cliff looks like, and the four steps every importer must take before the suspension expires.
In Plain Language: What MOFCOM Notice 61 Does to China Rare Earth Export Controls 2026
Before Notice 61, China controlled the export of rare earth elements themselves. If a Chinese company wanted to export terbium or dysprosium, it needed an export licence. That is the model every country uses for controlled materials.
MOFCOM Notice 61 broke this model by applying Chinese export control jurisdiction extraterritorially, mirroring the architecture of the US Foreign Direct Product Rule but applying it to raw material content in physical goods. For the first time in any major economy’s export control history, China asserted jurisdiction over products manufactured entirely outside its borders, by non-Chinese companies, in non-Chinese facilities, being traded between two non-Chinese countries, because those products contain a trace amount of a material that was originally produced in China. White and Case described this as China imposing “extraterritorial jurisdiction.” Mayer Brown called it China’s version of the US Foreign Direct Product Rule. The difference is that the US FDPR applies to advanced semiconductor technology. China’s version of it applies to rare earth content in virtually every advanced electronic product on earth.
The three categories of goods brought under Notice 61 as translated by the Georgetown University Center for Security and Emerging Technology are:
- Category 1 (the 0.1% rule): Permanent magnet materials and sputtering targets, plus parts, components, and assemblies containing them, that are manufactured outside China and contain Chinese-origin rare earth elements at 0.1% or more of the product’s value
- Category 2 (the technology rule): Products manufactured outside China using Chinese rare earth technologies, including mining, smelting, separation, metal smelting, magnetic material manufacturing, or rare earth recycling technology
- Category 3 (Chinese-origin items): Rare earth items that are originally produced in China, which were already subject to export controls before Notice 61
Categories 1 and 2 are the extraterritorial provisions. They are the reason Notice 61 is unprecedented. And they are the ones that will reimpose on November 10, 2026.
China Rare Earth Export Controls 2026: The Current Status and What the November 10 Suspension Expiry Means
Understanding the current status of China rare earth export controls 2026 requires separating three distinct layers that are at different stages of implementation:
- April 2025 controls (CURRENTLY IN FORCE): Export licences required for seven rare earth elements from Chinese suppliers: samarium, gadolinium, terbium, dysprosium, lutetium, scandium, and yttrium. These were never suspended. Chinese suppliers of these elements must obtain MOFCOM approval for every export. The supply bottlenecks from these April controls are already visible in S&P Global’s January 2026 analysis, which confirmed supply constraints are expected to persist through 2026 and 2027
- October 2025 controls including Notice 61 (SUSPENDED until November 10, 2026): The full package of MOFCOM Announcements 55-58, 61, and 62, including the 0.1% extraterritorial rule, the Foreign Direct Product Rule for rare earth technologies, and five additional elements (holmium, erbium, thulium, europium, ytterbium) were suspended by MOFCOM Announcement 70/2025 on November 7, 2025 as part of temporary trade de-escalation. The suspension expires November 10, 2026
- Case-by-case review posture (ACTIVE even during suspension): Even during the suspension, MOFCOM has signalled tightened scrutiny for exports involving advanced computing semiconductors and artificial intelligence with potential military applications. Products for 14 nanometre and below logic chips, 256-layer and above memory chips, and AI systems with potential military application face case-by-case licensing review regardless of the suspension status
November 10, 2026 is not an abstract future risk for any business exposed to China rare earth export controls 2026. It is a confirmed statutory date. If MOFCOM does not announce a further suspension before that date, the full extraterritorial controls reimpose on every product in Categories 1 and 2 simultaneously. Given that global supply chains have not materially reduced their dependence on Chinese-origin rare earth materials in the six months since the suspension began, the reimposition of these controls would create immediate disruption to AI hardware, automotive, medical device, and industrial equipment imports globally.
China Rare Earth Export Controls 2026: Which Products Are Affected by the 0.1% Rule
The practical scope of the China rare earth export controls 2026 Category 1 provision is extraordinarily broad. The 0.1% threshold applies to the value of Chinese-origin rare earth content relative to the total product value. For high-value products like enterprise servers and GPU infrastructure, the rare earth content as a percentage of total value is typically well below 0.1%. For lower-value components like magnets, motor assemblies, and specialised electronics, the threshold is readily exceeded.
The products where Notice 61 creates the clearest compliance exposure:
- NdFeB permanent magnets: Neodymium-iron-boron magnets are the primary product category in Notice 61’s Appendix. Virtually all high-performance permanent magnets contain dysprosium or terbium from Chinese sources. These magnets are inside hard disk drives, server cooling fans, electric motors in data centre infrastructure, robotic components, and precision industrial equipment. China accounts for approximately 94% of global sintered permanent magnet production per the IEA. There is no near-term alternative supply chain at scale
- Sputtering targets for semiconductor manufacturing: Yttrium, gadolinium, and other rare earth sputtering targets are critical consumables in semiconductor fabrication processes. Taiwan’s TSMC relied on Chinese-origin consumable materials for approximately 30% of its production capacity for chips at 7 nanometre and below according to Greyhound Research analysis. Notice 61 creates a licence requirement for these targets when manufactured outside China with Chinese-origin content
- Hard disk drives and storage components: Western Digital launched a programme to recover rare earth materials from retired drives in April 2025, explicitly in response to Notice 61 exposure. The control applies at the component level, meaning the magnet inside the drive rather than the completed drive itself may be the trigger point
- Display and lighting components: European manufacturers of LED backlights and LCD panels rely on phosphor compounds containing europium, terbium, and yttrium. Europium and terbium are both in the controlled list. Display panel manufacturers are directly in scope if their phosphor supplier uses Chinese-origin materials
- AI server cooling and power infrastructure: Data centre cooling systems, UPS units, and power conversion equipment all contain permanent magnet motors. The magnets in these systems are in scope under Category 1 if they contain Chinese-origin dysprosium or terbium above the 0.1% value threshold
China Rare Earth Export Controls 2026: What Notice 61 Requires From Every Party in the Chain
Notice 61 does not simply require a Chinese export licence at the point of export. It creates compliance obligations that flow through every layer of the supply chain, including to the final importer and end user. When Notice 61 reimpose on November 10, 2026, every importer of affected products needs to have the following infrastructure in place:
Rare Earth Bill of Materials Audit
A document identifying every rare earth element in your product, its country of origin, and the percentage of total product value it represents. It is the starting point for every Notice 61 compliance assessment. Without it you cannot determine whether your products are in scope, whether the 0.1% threshold is exceeded, or whether a Chinese export licence is required. For importers of AI hardware, start with permanent magnets in cooling systems and storage components.
Declaration of Compliance
A mandatory Notice 61 document that must travel through every layer of the supply chain: Chinese exporter to overseas manufacturer to distributor to importer. The Georgetown CSET Appendix 2 template requires the product name, the controlled rare earth content percentage of value, and an undertaking to comply with Notice 61 on further transfer. Request it from your supplier as a condition of purchase. If you receive an in-scope product without it, you carry compliance risk regardless of what you personally did.
Export Licence Verification
For products triggering the 0.1% threshold, the Chinese exporter or foreign manufacturer must hold a MOFCOM export licence before shipment. You cannot verify a Chinese licence directly as an importer, but the Declaration of Compliance from your upstream supplier is the practical evidence. If your supplier cannot produce the Declaration chain, you have no documentation that the export was legally authorised under Chinese law.
End-Use Restrictions
Notice 61 presumes denial of export licences for military end users and for entities on China’s export control entity list or watch list, including subsidiaries where listed entities hold 50% or more equity. This is China’s version of the US 50% Rule. As an importer, you must verify that goods in scope are not destined for military use or for a listed entity before completing any transaction.
China Rare Earth Export Controls 2026: What This Means for AI Hardware Importers Specifically
The intersection of China rare earth export controls 2026 with the AI hardware import compliance landscape Carra Globe clients navigate is direct and specific. Consider the supply chain of a typical NVIDIA H200 server deployment into an Indian or German data centre:
- The server is assembled by a contract manufacturer in Taiwan
- The cooling fans in the server contain NdFeB permanent magnets with dysprosium sourced from a Chinese refiner
- The hard disk drives in the storage array contain rare earth magnets from a Malaysian magnet manufacturer using Chinese-origin terbium
- The power conversion units contain motor components with Chinese-origin yttrium in the magnetic alloys
None of these components are themselves produced in China. The server is not manufactured in China. The importer is not importing from China. But under Notice 61’s Category 1, every transfer of those components once the suspension expires requires a Chinese MOFCOM export licence, and every transfer in the chain requires a Declaration of Compliance.
The practical implication for AI hardware importers is not that servers become impossible to import. It is that the documentation chain required to legally import them becomes significantly more complex. An Importer of Record filing a customs declaration for an H200 server deployment in India after November 10, 2026 may be required to demonstrate that the upstream supply chain has the necessary Chinese export licences and Declaration of Compliance documentation in place. Customs authorities in India, Germany, Singapore, and other markets may not currently have enforcement procedures for Notice 61 compliance at the import declaration stage, but the legal risk of importing goods that violated Chinese export control law sits with every party in the chain. For the full context on AI hardware import compliance, see our guides to AI GPU import compliance 2026 and the Chip Security Act 2026.
China Rare Earth Export Controls 2026: Four Actions Every Importer Must Take Before November 10
- Commission a Rare Earth Bill of Materials audit for every product category you import. Identify every rare earth element in your products, trace it to country of origin, and calculate the percentage of the product’s value attributable to Chinese-origin rare earth content. Any product where Chinese-origin rare earth content exceeds or might exceed 0.1% of value is potentially in scope under Notice 61. For AI hardware, start with permanent magnets in cooling systems, motors, and storage components. For industrial equipment, start with motor assemblies. For medical devices, start with imaging components and surgical equipment. Our Global Trade Compliance team conducts REE-BoM assessments across active import portfolios in all major markets
- Engage your upstream supply chain on Declaration of Compliance documentation immediately. The Declaration chain must start at the Chinese domestic exporter and flow through every transfer in the supply chain to reach you. If your supplier has not started building this documentation chain, they will not have it ready by November 10. Request written confirmation from every tier-one supplier of in-scope components that they have a plan for MOFCOM Notice 61 compliance before the suspension expires. Suppliers who cannot provide this confirmation are a supply chain risk that should be flagged and addressed before November, not after
- Map your supplier base for Chinese rare earth technology exposure under Category 2. Category 2 of Notice 61 covers products manufactured outside China using Chinese rare earth processing technologies. If your component suppliers use Chinese-origin smelting, separation, or magnetic material manufacturing equipment or know-how, their products may fall under Category 2 regardless of whether the finished product contains Chinese-origin rare earth elements above 0.1% by value. This is harder to identify than Category 1 and requires direct engagement with your tier-one and tier-two manufacturers about their production technology provenance
- Assess your IOR structure in each destination market for Notice 61 readiness. When Notice 61 reimpose in November, customs authorities in major markets will need to develop enforcement approaches. The importer of record named on the customs declaration is the entity that bears the legal compliance obligation for the import in the destination country. Confirm that your importer of record in each market is aware of Notice 61, has assessed its implications for the specific products they import on your behalf, and has a documentation protocol for Declaration of Compliance chain management. An IOR that is unaware of Notice 61 cannot manage its implications
How Carra Globe Supports Importers Navigating China Rare Earth Export Controls 2026
Carra Globe provides Importer of Record and Global Trade Compliance services for businesses importing products potentially in scope under MOFCOM Notice 61 across all major markets. Our compliance team conducts Rare Earth Bill of Materials assessments under the China rare earth export controls 2026 framework for active import portfolios, reviews upstream supplier Declaration of Compliance documentation chains, and identifies gaps in Notice 61 readiness before the November 10, 2026 suspension expiry. Our IOR entities in India, Germany, Singapore, the UAE, Japan, the UK, and 170+ additional markets are positioned to manage the import declaration process for in-scope products with Notice 61 documentation protocols integrated from November 10. Our Delivered Duty Paid service incorporates Notice 61 supply chain documentation requirements into the full landed cost and compliance package for affected product categories. Our Freight Forwarding service coordinates origin documentation for products in scope under China rare earth export controls 2026 from manufacturing origin through to final destination.
Frequently Asked Questions: China Rare Earth Export Controls 2026
Is MOFCOM Notice 61 and China rare earth export controls 2026 currently in force?
The extraterritorial provisions of Notice 61, specifically Category 1 (the 0.1% rule) and Category 2 (the technology rule), are currently suspended until November 10, 2026 by MOFCOM Announcement 70/2025. Category 3, covering Chinese-origin rare earth items themselves, and the April 2025 controls on seven specific elements, remain in force. The November 10, 2026 expiry of the suspension is the date on which Categories 1 and 2 reimpose unless MOFCOM announces a further extension.
Which rare earth elements are controlled under the China rare earth export controls 2026 framework?
The April 2025 controls (currently in force) cover samarium, gadolinium, terbium, dysprosium, lutetium, scandium, and yttrium. The October 2025 package, suspended until November 10, 2026, added holmium, erbium, thulium, europium, and ytterbium. When the suspension expires, all 12 elements plus their alloys, oxides, and compounds will be controlled. The most commercially significant for AI hardware and data centre supply chains are dysprosium, terbium, and yttrium, which are essential for high-performance permanent magnets used in motors, drives, and cooling systems.
Do China rare earth export controls 2026 apply to completed products like servers and GPU systems?
For most complete servers, no. An H200 server costs several hundred thousand dollars. The rare earth content of its cooling fan magnets as a percentage of total server value is almost certainly below 0.1%. The risk is at component level: permanent magnets, sputtering targets, and motor assemblies traded separately easily exceed the threshold. Assess your supply chain at the component level, not the finished product level.
What is the Declaration of Compliance under China rare earth export controls 2026?
A mandatory document under Notice 61 Appendix 2 that must travel through every layer of the supply chain. The Chinese exporter issues it to the overseas buyer, who passes it to the next recipient, and so on to the final importer. It states the product details, controlled rare earth content, and its percentage of value. If you receive a product in scope without the Declaration, you carry compliance risk regardless of whether you did anything wrong. Request it from your supplier as a condition of purchase.
Will MOFCOM extend the China rare earth export controls 2026 suspension beyond November 10?
Unknown. The suspension was part of a temporary de-escalation in US-China trade tensions following emergency consultations. Both sides understood the freeze was temporary and that the underlying controls would be revisited. The geopolitical and trade policy environment between the US and China as of May 2026 does not suggest a definitive resolution of the tensions that produced Notice 61. Businesses planning supply chain decisions on the assumption of an extension are accepting geopolitical risk as a supply chain planning assumption. The operationally sound approach is to prepare for November 10 compliance as if the suspension will not be extended, while monitoring MOFCOM announcements for any update.
How do China rare earth export controls 2026 interact with US BIS export controls on AI hardware?
They are parallel and independent. BIS governs what hardware can leave the US and for which end users. Notice 61 governs what products containing Chinese-origin rare earth materials can be transferred between non-Chinese parties. Shipping H200 servers from Taiwan to India requires compliance with both simultaneously. Satisfying BIS gives you no protection under Notice 61 and vice versa. See our AI GPU import compliance 2026 guide for the full framework.