US Department of Defense sanctions-related lists

Two high-profile Department of Defense publications — Section 1260H (Chinese military companies) and Section 1286 (foreign institutions and talent programs of concern) — are often discussed alongside US sanctions and export controls. This guide explains what each list is, how it is produced, and how it relates to Treasury investment restrictions, research funding, and other US restricted-party tools.

Section 1260H — Chinese Military Companies (CMC)

Statutory basis. Section 1260H of the National Defense Authorization Act for Fiscal Year 2021 (FY2021 NDAA) requires the Secretary of Defense to identify companies that qualify as “Chinese military companies” under the provision's criteria, including companies operating directly or indirectly in the United States.1

What DoD publishes. The Department of Defense publishes the resulting identification as the Chinese Military Companies (CMC) list (sometimes referred to in policy discussions as the Section 1260H list). The list has included on the order of one hundred or more companies across sectors such as defense and aerospace, advanced technology, telecommunications, surveillance-related activities, and infrastructure and construction, reflecting the statutory criteria rather than a single industry category.

Not a standalone OFAC blocking list. Publication on the DoD Section 1260H list does not, by itself, replicate an OFAC asset-blocking designation. The practical significance is downstream:

• Treasury / investment restrictions. Executive Order 14032 and related Treasury measures target certain securities investments in entities identified as Chinese military companies for purposes of the Non-SDN Chinese Military-Industrial Complex Companies (NS-CMIC) program.2 Parties identified under Section 1260H are a primary reference set for those identifications; US persons must observe the specific prohibitions and definitions in Treasury's rules, not the DoD PDF alone.
• Procurement and contracting. Separate statutes and regulations restrict US government procurement from certain telecommunications and other equipment providers tied to identified Chinese military companies; compliance teams often map DoD identifications into procurement screening.
• Reputational and diligence risk. Investors, lenders, and counterparties frequently treat CMC identification as a red flag in enhanced due diligence even when a transaction is not US-regulated.

Updates. DoD is required to update the Section 1260H identification annually, with revisions also reflected through Federal Register notices and official defense materials.3

Section 1286 — Foreign institutions and talent programs of concern

Statutory basis. Section 1286 of the FY2019 NDAA directs the Secretary of Defense to identify foreign institutions that undermine the security of US research and innovation, and to identify foreign government talent recruitment programs that pose a threat to US national security or interests.4

Policy focus. The identification process is oriented toward academic and research security and toward foreign state-sponsored or state-associated talent recruitment programs. Congressional reporting and DoD materials have emphasized concern where programs operate in or involve countries of strategic concern, including China, Russia, Iran, and North Korea, subject to the specific findings made in each annual publication.

Who publishes it. The list is published under the authority of the Under Secretary of Defense for Research and Engineering, consistent with DoD's research and engineering enterprise and federal research-security policy coordination.5

Implications for US universities and research performers. Institutions that receive Department of Defense research funding are expected to align collaborations, subawards, visitor programs, and disclosures with federal research-security requirements. A collaborator or program that appears on the Section 1286 identification can trigger additional institutional review, certification questions, or restrictions depending on the award terms, agency guidance, and the institution's policies. This is distinct from a Commerce export license determination but equally material for grants and contracts compliance teams.

How these lists fit with OFAC, BIS, and broader screening

Identification vs. blocking or licensing

OFAC administers blocking and other sanctions programs (for example, the SDN List and the NS-CMIC investment restrictions). BIS administers the Entity List, Denied Persons List, and related export-control restrictions. DoD Sections 1260H and 1286 identify parties or programs for statutory and policy purposes; legal prohibitions arise from the specific rules that reference those identifications (Treasury investment rules, procurement statutes, grant terms, institutional policy).

Why screen both DoD lists in a restricted-party workflow

• 1260H → investment and procurement pathways. A match may require escalation to securities compliance, government-contracts counsel, or vendor onboarding teams, in addition to an OFAC NS-CMIC check.2
• 1286 → research funding and partnerships. A match may require review by sponsored research, export control, and research-security offices rather than only a traditional sanctions scan.
• BIS Entity List. A party can be on the Entity List for export licensing reasons without appearing on a DoD identification, and the reverse can also occur; the lists answer different statutory questions.6

For a consolidated view of multiple jurisdictions and agencies, see our sanctions screening guide and the OFAC sanctions list guide (including discussion of NS-CMIC and investment restrictions).