British Prime Minister Keir Starmer said that China has agreed to lift sanctions on five UK MPs and two peers targeted for their criticism of alleged human rights abuses.
The lawmakers were barred from entering China and Chinese entities were forbidden from doing business with them in 2021.
Beijing accused them of spreading "lies and disinformation" over China's treatment of the Muslim Uyghur minority in its Xinjiang region.
Those measures came after the UK sanctioned four Chinese officials it said were responsible for atrocities in Xinjiang.
The Chinese sanctions affected high-profile China hawks Tom Tugendhat, the former security minister, and Iain Duncan Smith, the work and pensions secretary until 2016.
"I raised that issue... and the Chinese are absolutely clear in response; the restrictions no longer apply. President Xi said to me that that means all parliamentarians are welcome," Mr Starmer said during an interview with UK television.
"That shows that if you engage, you can raise the difficult issues," he said during a visit to China to boost economic ties with the world's second-largest economy.
The seven parliamentarians, one of whom has since stopped being an MP, released a statement before the move was confirmed.
"We would rather remain under sanction indefinitely, than have our status used as a bargaining chip, to justify lifting British sanctions on those officials responsible for the genocide in Xinjiang", they said in a statement released by the Inter-Parliamentary Alliance on China, a UK group representing an international network of politicians critical of Beijing.
Mr Starmer's visit drew criticism from within the UK, as well as from US President Donald Trump.
Beijing has been accused of detaining more than a million Uyghurs and other Muslims since 2017, part of a campaign that the United Nations has said could constitute "crimes against humanity".
China vehemently denies the allegations, saying its policies have rooted out extremism in Xinjiang and boosted economic development.
Starmer brushes off Trump's criticism of visit
Mr Starmer has brushed off comments by US President Donald Trump warning it was "dangerous" for the UK to do business with China, saying the president was "talking more about Canada".
Mr Trump expressed disapproval of the Mr Starmer's trip to China in remarks to reporters.
"Well, it’s very dangerous for them to do that, and it’s even more dangerous, I think, for Canada to get into business with China," he said.
But in broadcast interviews in Shanghai, Mr Starmer said his visit had been "very successful".
He said: "I’ve seen President Trump’s comments. I think, to be fair, he was probably talking more about Canada than the United Kingdom."
Adding that the US and UK remained "very close allies", he said his visit to China had been discussed with Mr Trump’s team beforehand and pointed to the president’s upcoming visit to the country in April.
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China's Uyghur population control was genocide - report