China Primer: Illicit Fentanyl and China’s Role

China Primer: Illicit Fentanyl and China’s Role

Updated February 20, 2024
China Primer: Illicit Fentanyl and China’s Role
In addressing the international dimension of the opioid
Convention. In 2018, consistent with the U.N. decision, the
crisis in the United States, policymakers have sought to stop
PRC implemented corresponding domestic controls. In
foreign-sourced fentanyl, fentanyl-related substances (i.e.,
2022, U.N. member states subjected three additional
analogues), and chemical inputs (e.g., precursors) from
fentanyl precursors to international control: N-Phenyl-4-
entering the United States. Beginning in the mid-2010s,
piperidinamine (4-AP), tert-Butyl 4-(phenylamino)
U.S. authorities identified the People’s Republic of China
piperidine-1-carboxylate (1-boc-4-AP), and norfentanyl. In
(PRC, or China) as a primary source of U.S.-bound illicit
June 2023, the PRC government said it was “in the process
fentanyl and fentanyl analogues. The PRC’s imposition of
of scheduling” three additional fentanyl precursors—
class-wide controls over all fentanyl-related substances in
presumably those the U.N. scheduled in 2022—but the PRC
2019 changed trafficking patterns. Direct flows of such
has provided no further information.
substances from China to the United States appeared largely
to cease. Today, the focus of China-related U.S.
Sources and Trafficking Pathways
counternarcotics policy has shifted to preventing PRC-
DEA alleges that PRC-based chemical companies advertise
sourced fentanyl precursors and associated equipment,
and sell online fentanyl precursor chemicals, including
along with other synthetic drugs that may be mixed with
some that are not internationally controlled and are
fentanyl substances, from entering the U.S.-bound fentanyl
correspondingly legal to export out of China. PRC firms
supply chain. The U.S. government also seeks to target
also sell other synthetic drugs of concern, including
illicit fentanyl-related financial flows linked to China. A
xylazine and nitazenes. PRC companies ship such items to
November 2023 summit in California between President
Mexico or directly to the United States, including via the
Joseph R. Biden, Jr. and China’s leader, Xi Jinping,
U.S. Postal Service and express consignment services,
renewed cooperation on drug control issues after more than
“carefully packaged to deceive customs inspectors.”
three years of stasis.
According to DEA, customers, often associated with
Background
Mexico-based transnational criminal organizations (TCOs),
may pay for the chemicals and drugs in cryptocurrencies,
Fentanyl is a potent synthetic opioid that has been used
making it harder for DEA “to follow the money.” They also
medically as a painkiller and an anesthetic since it was first
pay using U.S. and PRC payment services or bank transfers.
synthesized in 1959. Due to fentanyl’s potential for abuse
DEA alleges that the TCOs use largely PRC-sourced
and addiction, the United Nations (U.N.) placed it under
chemicals to synthesize fentanyl substances in clandestine
international control in 1964. Domestically, fentanyl is
laboratories, and often mix xylazine and nitazenes into
regulated by the Drug Enforcement Administration (DEA),
fentanyl-related products, making the substances “even
pursuant to the Comprehensive Drug Abuse Prevention and
deadlier,” before distributing them across North America.
Control Act of 1970, as amended (21 U.S.C. §§801 et seq.).
The U.S. Centers for Disease Control and Prevention
The 2022 report of the U.S. Commission on Combating
estimate that synthetic opioids (primarily fentanyl-related
Synthetic Opioid Trafficking (established pursuant to §7221
substances) may have resulted in more than 78,000 U.S.
of P.L. 116-92) concluded that the PRC’s chemical and
overdose deaths between September 2022 and August 2023.
pharmaceutical sectors have “outpaced the government’s
Traffickers appear to be marketing a growing number of
efforts to regulate them, creating opportunities for
fentanyl analogues for nonmedical, often unregulated, use.
unscrupulous vendors to export chemicals needed in their
illegal manufacture.” The U.S. Department of the Treasury
As of November 2023, the International Narcotics Control
assesses that Mexico-based cartels are increasingly working
Board (INCB)—an independent expert body that monitors
with PRC money laundering organizations.
governments’ compliance with U.N. drug control
conventions—reported the existence of 153 fentanyl-related
Addressing China’s Role
substances with no currently-known legitimate uses. The
The Biden Administration’s 2022 National Drug Control
U.N. Office on Drugs and Crime estimates that laboratories
Strategy prioritizes increased collaboration with the PRC
could potentially synthesize thousands of other fentanyl
“on shared drug priorities” and continued engagement “to
analogues. As of May 2023, more than 30 fentanyl-related
reduce diversion of uncontrolled precursor chemicals.” In
substances, including precursors, are subject to international
February 2023 Senate testimony, Assistant Secretary of
control (“scheduled”) pursuant to the U.N. Single
State for International Narcotics and Law Enforcement
Convention on Narcotic Drugs of 1961, as amended, and
Affairs Todd Robinson noted that the United States has
the U.N. Convention Against Illicit Traffic in Narcotic
“encouraged the PRC to improve information-sharing on
Drugs and Psychotropic Substances of 1988.
global chemical flows, strengthen enforcement of customs
manifesting agreements, and implement know-your-
U.N. member states first subjected fentanyl precursors to
customer standards to restrict the sale of precursor
international control in 2017, agreeing to list the precursors
chemicals to only customers with legitimate needs.” In July
N-Phenethyl-4-piperidone (NPP) and 4-Anilino-N-
phenethylpiperidine (ANPP) on Table I of the 1988
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China Primer: Illicit Fentanyl and China’s Role
2023, the United States launched a Global Coalition to
years, the PRC also resumed submitting real-time incidents
Address Synthetic Drug Threats, including fentanyl.
of suspicious shipments of fentanyl-related substances and
other new psychoactive substances to the INCB. (The
The U.S. government has taken several unilateral actions to
White House says the PRC submitted 145 such incidents in
address China’s role in fentanyl and precursor trafficking.
November 2023 alone.) After the summit, the PRC National
•
Narcotics Control Commission (NNCC), housed within
The U.S. Department of the Treasury’s Office of
MPS, warned PRC actors that they may be subject to law
Foreign Assets Control has so far sanctioned more than
enforcement actions from other countries for sales and
65 mainland China- or Hong Kong-based persons for
trafficking of substances not currently subject to controls in
illicit fentanyl, xylazine, or nitazenes trafficking. The
China. The notice cautioned PRC actors specifically about
sanctions block assets under U.S. jurisdiction, prohibit
sales to the United States and Mexico, including sales of
U.S. persons from engaging in financial transactions
pill presses. An appendix identified all 51 U.S.-listed
with those designated, and ban such traffickers from
precursors. In late January 2024, a senior Biden
entry into the United States.
Administration official reported that the United States was
•
“starting to see reductions in seizures of precursors at some
In June 2023, the Department of Justice (DOJ) indicted
U.S. airports already.”
three PRC-based companies and their employees for
fentanyl-related crimes. In September 2023, DOJ
The working group met for the first time in Beijing on
indicted eight more PRC chemical companies and 12 of
January 30, 2024. White House Deputy Homeland Security
their executives for crimes related to fentanyl, other
Advisor Jen Daskal led the U.S. delegation. Her PRC
synthetic opioids, methamphetamines, and their
counterpart was State Councilor Wang Xiaohong, who
precursor chemicals.
serves concurrently as Minister of Public Security and head
of the NNCC. Per the White House, “The two sides
• In September 2023, President Biden added China to the
emphasized the need to coordinate on law enforcement
U.S. list of the world’s major illicit drug-transit or drug-
actions; address the misuse of precursor chemicals, pill
producing countries, citing the PRC’s role in the
presses, and related equipment to manufacture illicit drugs;
production of precursor chemicals used to produce illicit
target the illicit financing of transnational criminal
drugs significantly affecting the United States.
organization networks; and engage in multilateral fora.”
Secretary of Homeland Security Alejandro N. Mayorkas
U.S.-PRC cooperation on fentanyl has yielded some
and State Councilor Wang met in Vienna on February 18,
successes. In May 2019, the PRC added all fentanyl-related
2024. According to a U.S. readout, with regard to illicit
substances not already scheduled to its “Supplementary List
synthetic drugs, the two committed to “continued law
of Controlled Narcotic Drugs and Psychotropic Substances
enforcement cooperation, technical bilateral exchanges
with Non-Medical Use.” In 2019 and 2021, joint U.S.-
between scientists and other experts, scheduling of
China investigations resulted in PRC courts sentencing
precursor chemicals, and furthering multilateral
defendants for trafficking fentanyl to the United States and
cooperation.” The PRC readout quoted Wang as also
Canada. In 2020, the U.S. Postal Service reported that
China Post was “nearly fully achieving” the
calling on the United States to “correct the mistake of
requirement,
listing China as a ‘major drug source country.’”
pursuant to the Synthetics Trafficking and Overdose
Prevention (STOP) Act of 2018 (Title VIII, Subtitle A of
Related Legislation in the 118th Congress
P.L. 115-271), that 100% of its U.S.-destination packages
The National Defense Authorization Act for FY2024 (P.L.
be accompanied by customs advance electronic data (AED).
118-31), requires a determination of whether the PRC
Bilateral counternarcotics cooperation appeared to stall
government “assisted in or approved of the transportation of
beginning in 2020. The PRC government blamed U.S.
pill presses, fentanyl products, or fentanyl precursors to one
actions unrelated to counternarcotics. It pointed to the U.S.
or more Mexican drug cartels” (Sec. 1311). It also states
Department of Commerce (DOC)’s June 2020 addition to
that it is the sense of Congress that PRC and Mexican
its Entity List of an institute under the PRC’s Ministry of
organizations that traffic or finance trafficking in illicit
Public Security (MPS), the Institute of Forensic Science,
fentanyl should be “among the highest priorities” for the
which subjected the institute to export controls. DOC
Office of the Director of National Intelligence (Sec. 7325).
alleged the institute was “implicated in human rights
Pending legislation includes the Senate-passed FEND Off
abuses” in the PRC’s Xinjiang Uyghur Autonomous
Fentanyl Act (H.R. 815), the House-passed Stop Chinese
Region. The PRC formally suspended bilateral
Fentanyl Act of 2023 (H.R. 3203), the Strengthening
counternarcotics cooperation in August 2022, in response to
Sanctions on Fentanyl Traffickers Act of 2023 (S. 2059),
then-House Speaker Nancy Pelosi’s visit to Taiwan.
the Stop Fentanyl Money Laundering Act of 2023 (H.R.
3244), and the Project Precursor Act (H.R. 3205). The
At their November 2023 summit, President Biden and
Senate’s Department of State, Foreign Operations, and
Communist Party of China General Secretary Xi agreed to
Related Programs Appropriations Acts for 2024 (S. 2438)
resume counternarcotics cooperation and to launch a
would also include provisions related to fentanyl and China.
counternarcotics working group. In parallel, DOC removed
the MPS institute from the Entity List. The White House
Ricardo Barrios, Analyst in Asian Affairs
reported that the PRC shut down some PRC-based suppliers
Susan V. Lawrence, Specialist in Asian Affairs
of synthetic drugs and precursors and blocked their
Liana W. Rosen, Specialist in International Crime and
international payment accounts. After a pause of three
Narcotics
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China Primer: Illicit Fentanyl and China’s Role

IF10890

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