One of the men leading President Donald Trump's push to redesign trade with China owns a stake in a shipping company that does business in China and whose vessels sail under Hong Kong's flag.
Trump has pledged to get tough on trade when he meets with Chinese President Xi Jinping later this week. Commerce Secretary Wilbur Ross, who will play a role in any trade policy changes, has part ownership of Diamond S Shipping, a company with ties to China and other parts of Asia.
Ross, a billionaire financier, divested from many assets that could have posed ethics issues before taking the Cabinet spot. In his required financial disclosure, Ross said he would step down from his management roles with Diamond S Shipping and remove himself from decision-making but keep a passive stake in the company, according to the Center for Public Integrity.
His remaining ownership stake in the company underscores the conflicts that wealthy members of Trump's administration could face as they shape his economic agenda.
A Commerce Department spokesman declined to tell CNBC whether Ross sees a need to distance himself from any specific trade negotiations, but said that "as a general matter, Commerce's ethics officials provide the secretary with ongoing guidance to avoid any potential conflicts of interest."
Trump has repeatedly criticized China, alleging that the world's second-largest economy manipulates its currency in order to make its exports cheaper than comparable U.S. products and rack up a massive trade surplus with the United States. Last week, Trump previewed the meeting with Xi by saying "we can no longer have massive trade deficits and job losses."
On Friday, Ross further highlighted the U.S. trade deficit with China in a CNBC interview. Asked why the administration thinks deficits are bad, Ross said, "if trade deficits are good, why is China so pleased that they run a huge trade surplus?"
Another Diamond S Shipping owner: Beijing
Changes to the U.S. trade relationship with China or other parts of the world may affect Diamond S Shipping. As of 2014, Ross held a roughly 32 percent stake in the company, according to a 2014 SEC filing about a since-scrapped initial public offering.
Diamond S Shipping, which is legally incorporated in the Marshall Islands, runs 33 product tankers that move refined petroleum and other products, the filing said. Most of those ships are chartered to companies for years at a time.
The shipper has a strong presence in Asia. Most of its product tankers sail under Hong Kong flags. Diamond S Shipping's vessels have stopped in China more than 100 times since 2012, according to the Center for Public Integrity.
Chengdong Investment Corp., which is controlled indirectly by China's communist government, also held just under a 9 percent stake in Diamond S Shipping as of 2014.
Actual management of the fleet is controlled by Diamond S Shipping's Connecticut-based management team, according to Jim Lawrence, chairman of industry trade publication Marine Money.
It is difficult to assess exactly how much Ross' stake is worth, as the company is private, and many of the Commerce secretary's holdings are listed in complex instruments on his disclosure form.
But even if the stake represented only a small portion of the billionaire's assets, the holding looks significant enough that Ross may need to distance himself from trade negotiations that affect the company, said Richard Painter, who served as a White House ethics lawyer under President George W. Bush.
"I think he knows he has to recuse himself from any matter that has an effect on the shipping company," Painter said.
Selling his holding in the company would eliminate the potential conflict for Ross, Painter added. However, unloading an interest in shipping could prove difficult in an environment in which Trump has threatened protectionism and used an "America First" mantra.
The spokesman at Commerce declined to tell CNBC whether Ross' Diamond S Shipping stake means he would step back from any trade-related decisions.
It remains to be seen what trade changes — if any — the Trump administration will attempt to extract from China.
— CNBC's Lori Ann Larocco contributed to this report.