• China mandates rare-earth firms to disclose expert details, including passport controls.
  • Stricter export controls under Announcement No. 18 of 2025 disrupt global supply chains.
  • Western nations accelerate efforts to reduce reliance on Chinese rare-earth dominance.

Beijing’s Rare-Earth Crackdown Intensifies

Chinese authorities have instructed rare-earth companies to submit comprehensive information about their technical experts, with some specialists reportedly asked to surrender their passports, according to sources familiar with the matter. The move appears aimed at preventing trade-secret leaks and tightening control over critical personnel in a sector where China holds global dominance.

The measures coincide with stricter enforcement of export controls outlined in Announcement No. 18 of 2025, which requires detailed licensing for rare-earth shipments. A multiagency campaign launched earlier this year has already caused bottlenecks in supply chains for industries reliant on these materials, from electric vehicles to defense systems.

Geopolitical Leverage and Market Fallout

“This isn’t just about resource control—it’s about locking down expertise,” said one industry analyst, noting that China produces over 70% of the world’s processed rare earths. The restrictions have sent shockwaves through global markets, with spot prices for heavy rare-earth oxides climbing 12% since May.

Western governments are scrambling to respond. The U.S. Department of Defense recently fast-tracked funding for domestic rare-earth processing projects, while the EU is negotiating partnerships with mining firms in Greenland and Australia. “Every day these controls stay in place, the business case for alternatives grows stronger,” a European trade official remarked.

Human and Operational Impacts

Employees at affected Chinese firms describe an atmosphere of heightened scrutiny. “Colleagues working on separation technologies were suddenly pulled into meetings with export compliance officers,” said one rare-earth engineer, speaking anonymously due to sensitivity. Requests for comment to China’s Ministry of Industry and Information Technology went unanswered.

Industry observers warn the passport measures could backfire by discouraging top talent from staying in the sector. Meanwhile, some manufacturers are stockpiling key materials—Japanese automakers reportedly increased rare-earth inventories by 30% quarter-over-quarter.

Correction: An earlier version misstated the percentage increase in rare-earth oxide prices; the correct figure is 12%, not 15%.