The decision, while expected, has not been officially confirmed.
The EU has not issued punitive sanctions on China for human rights abuses since the Tiananmen Square massacre in 1989.
It came as EU foreign ministers agreed on a series of different sanctions against various countries and entities.
Why would the EU impose sanctions?
In the last few years, hundreds of Uighurs, as well as other ethnic minorities in China such as Kazakhs and Huis have testified about being held in internment camps.
Observers say such facilities are part of a government campaign to forcibly assimilate ethnic minorities, sometimes using torture and forced labor. Mass rapes and the forced sterilization of women are also alleged to have taken place in the camps.
Beijing says the camps - which are estimated to have held more than 1 million people since 2017 - are “vocational education centers” to prevent extremism and terrorism.