A senior Israeli defense export official (Meir Shalit) recently resigned because a bit of American technology (part of an Israeli cooling system) ended up in a French electro-optical system that was sold to China. While it was legal to sell the Israeli item to France, an American defense export law was broken when the French sold the item to China. Shalit did not have to resign, as the issue was minor and not deliberate. But because of several past, more serious, cases where China got American military tech via Israel, it was considered prudent for the popular and competent Shalit to take the fall.
The prohibition against selling military tech to China is part of the Western arms embargo against China because of the 1989 Tiananmen Square massacre. This embargo is more rigorously enforced in the United States than in the rest of the world. In Europe the embargo tends to be more evaded than complied with. Major military exporters like France and Germany are leading the way. European firms are particularly eager to drop the embargo and some, like France, are often ignoring it. This is done most frequently by disregarding the installation of dual-use Western equipment in Chinese weapons systems. Two of the most blatant recent examples are the use of French Arriel 2C engines (built under license in China) for the Z-9WE helicopter gunship and China being able to purchase over fifty German maritime (for ships) diesel engines and install them in new Chinese subs (that are based on the Russian Kilo, which uses less capable and reliable Russian diesels). Unlike the French, the Germans make an effort to prevent dual use equipment from being exported. But once this stuff is in China the Chinese can, and often do, whatever they want and frequently they want to modify well engineered Western equipment (like maritime diesels) to suit their military needs. The Chinese had noted that the Russian maritime diesels were not nearly as quiet and reliable as the German ones from MTU. While the Chinese received MTU maritime diesels meant for commercial ships, not subs, the MTU diesels were much better quality and easily modified to work in China’s new subs.
China's Z-9WE helicopter gunship is a much better performer with the Arriel 2C engine, which is only supposed to be used for Chinese civilian helicopters, and has been used for over 300 of them. Earlier models of the Z-9 used Chinese designed and built WZ8A engines and these were not satisfactory. So now China is advertising the use of Arriel 2C engines in its Z-9WE combat helicopters.