U.S. President Donald Trump is hardening his approach to China, just weeks before he's due to leave office.
Reuters sources say Trump is set to add dozens of Chinese companies to a trade blacklist for their alleged ties to the military, including the country's top chipmaker SMIC.
It means the company will need to have a special license from the Commerce Department before a U.S. supplier can send it goods.
In total, 80 companies are expected to be targeted - nearly all of them Chinese.
According to sources, some are accused of helping Beijing construct and militarize artificial islands in the South China Sea, while others are said to have had a role in alleged human rights abuses against China's Uighur minority.
Companies already on the list include the telecoms giant Huawei and the surveillance camera maker Hikvision.
SMIC has repeatedly said it has no ties to China's military.
But it's already been in Washington's crosshairs.
Last month the Defense Department effectively banned Americans from buying shares in the chipmaker from late next year.
China's Foreign Ministry urged the U.S. on Friday to end what it called an "unjustified" crackdown on Chinese companies.