When the Japan Maritime Self-Defense Force recently spotted a Chinese navy flotilla sailing into the West Pacific, what disturbed them was not just that the Chinese went through the Osumi Strait, a sea lane off Japan's Kagoshima Prefecture usually used by the US 7th Fleet.

The subsequent exercise spotlighted an apparent violation committed by a European Union member state against the bloc's arms embargo against China. Footage released by the Japanese showed small unmanned helicopters apparently purchased from Austria that were parked on a Chinese missile frigate while another hovered above.

The unmanned aerial vehicle in question, apparently the Camcopter S-100, weighs 200 kilograms, is powered by a 55 hp engine and can climb to 5,500 meters. It is produced by the Austrian manufacturer Schiebel, can be deployed for surveillance, reconnaissance and target acquisition and can be fitted with small missiles. Defense analysts are positive that the helicopters were supplied by the Austrians because the S-100 is among very the few helicopter UAVs, if not the only one, that can operate at sea. The Pakistani, German and French navies have already tested them successfully, suggesting that the Austrians have been taking liberties with the EU arms embargo against China.

Japan's Ministry of Defense said the passage of Chinese warships through the Osumi Strait was the first such occurrence in nine years. Defense analysts believe the Chinese Navy’s motive, in addition to becoming a true blue water navy, is to familiarize itself with a strategically important part of the West Pacific. The channel the Chinese flotilla passed through is less fewer than 100 km wide, putting major Japanese cities in easy cruise missile range. In the event of a naval confrontation between China on one side and the US and Japan on the other, these waters would likely see combat action.

In the word of James Holmes, an associate professor at the US Naval War College, dual use goods such as the Camcopter S-100 can help the Chinese in this context, making perfect sense that they have been turning to EU nations.

“Our European friends have more or less renounced their ability to command the sea in favor of military operations other than war. So warfighting technologies are not their area of specialty,” Holmes said.

“But what they do excel at is noncombat missions and supporting technologies. This explains the Chinese interest in European seaborne UAVs. Such craft help out immensely with 'maritime domain awareness.' They detect who is out there at sea and what they're up to and also help out with combat effectiveness at the margins.”

To the question that the Chinese navy might have procured the unmanned copters from another country, Oliver Braeuner, a China and security analyst at the Stockholm International Peace Research Institute told Asia Sentinel that Scheibel is actually promoting the Camcopter S-100 with simplified characters only China uses.”

“They apparently take particular aim at customers from China,” Braeuner said.

However, the sale – if there indeed was one as the company neither confirmed nor denied it when asked for clarification – wasn’t necessarily illegal despite the embargo, Braeuner said.

“As opposed to other, newer EU arms embargoes, the one against China is merely based on a scarcely worded political declaration,” he said. “That's why there are very differing interpretations within the EU regarding its scope.”

Braeuner singled out Sweden for its conservative stance, while pointing at Germany, France and the UK as nations that don't particularly hesitate in selling so-called “non-lethal dual use goods” to China.

Braeuner presented data dealing with deliveries or orders by EU nations to China from 2009 to 2011 included diesel ship engines, surface-to-air-missiles, anti-submarine helicopters, helicopters and search radar from France, diesel engines from Germany for tanks; and turbofan jet engines for Chinese-made combat aircraft from the UK.

The EU arms embargo against China was imposed by Brussels in response to Beijing's bloody suppression of the Tiananmen Square protests of 1989. While the Chinese have protested against the ban ever since, labeling it "political discrimination,” there are numerous pros and cons from a Western perspective. The US and Japan are flatly against the lifting, while France has openly called for scrapping it, and other countries – notably Spain and Greece – have supported repeal at times. The UK has ostensibly consistently opposed lifting the embargo, while new EU members from the former Soviet bloc also tend to want it kept in place because they too once suffered under Communist rule.

Richard Weitz, a senior fellow and director of the Hudson Institute's Center for Political-Military Analysis, broke down the arguments in an article he recently wrote for The Diplomat. Asia Sentinel obtained Weitz's permission to draw from it.

His list of pros for the lifting began with the obvious:

“China is one of the largest creditors in the world and its foreign exchange reserves have reached almost US$3.2 trillion,” Weitz argued. "Europe wants Beijing to use some of these vast reserves to help stabilize the euro and support the EU’s economic recovery.”

He added that austerity programs by EU nations led to cuts in their defense spending, decreasing domestic sales opportunities for many EU defense companies, while the US remains a reluctant purchaser of European military products.

“Sales to China could therefore help European defense firms sustain their work forces, achieve economies of scale, and recoup R&D expenditures through larger production runs,” Weitz asserted.

Opponents of the embargo argue that it is counter-productive, Weitz added, encouraging China to develop its own domestic military research, development and production capabilities, and that expansion of the EU’s defense sales to China – mainly through the threat to boycott them once they have been introduced – could give Brussels a means to pressure Beijing on human rights and other issues.

Weitz pointed out that most advocates of the lifting don’t expect that the EU would sell major weapons systems to China even if it ends the ban.

On the other side, Weitz says, are Washington's fears that Beijing could incorporate EU military technology into its own weapons, and that EU companies might transfer US military technologies to China due to the extensive EU-US defense industrial cooperation. American policymakers have also argued that helping develop China’s military-industrial complex would in the end make the country a more formidable arms dealer, which in turn could bring sophisticated weaponry to rogue states.

Arrayed against ending the ban are also the lack of improvement regarding human rights in China, the country's growing and opaque military potential, its headline-grabbing territorial claims and its assertion of the right to employ military force to recover Taiwan.

“Regarding the latter, there’s a particular worry that EU action could precipitate an end to the recent warming of cross-Strait relations,” Weitz told Asia Sentinel. “If Beijing thinks the EU no longer cares about its policies towards Taiwan, that might reduce one inhibition against Chinese military action across the Strait.”

Weitz concluded with the perhaps most intriguing argument for the scrapping of the ban. Repealing the embargo could prompt the Russian government to change its policies and permit China to purchase its top-line weapons in order to retain its market share.

“For example, Russia might sell China long-range strategic bombers, more advanced air defense systems, and naval aviation systems for China’s emerging carrier fleet.”