The US has tightened export controls on Chinese companies to prevent circumvention of existing rules aimed at slowing China's semiconductor development, reports London's Financial Times.

The US Commerce Department announced that subsidiaries of entities already on the government's "entity list" will now be automatically blacklisted. The list includes foreign groups subject to export restrictions.

US firms must obtain a licence to export to listed entities, though many applications are denied when the recipients are Chinese companies.

While the rule does not explicitly target China, subsidiaries of Huawei and Semiconductor Manufacturing International Corporation are among those affected.

The department said the move closes a loophole that allowed subsidiaries to use "diversionary schemes" to mislead exporters and bypass restrictions.