{"id":8054,"date":"2021-07-02T06:30:42","date_gmt":"2021-07-02T06:30:42","guid":{"rendered":"https:\/\/focus.cbbc.org\/?p=8054"},"modified":"2025-04-23T09:52:17","modified_gmt":"2025-04-23T09:52:17","slug":"implications-of-chinas-new-anti-foreign-sanctions-law","status":"publish","type":"post","link":"https:\/\/focus.cbbc.org\/implications-of-chinas-new-anti-foreign-sanctions-law\/","title":{"rendered":"The implications of China\u2019s Anti-Foreign Sanctions Law"},"content":{"rendered":"

China’s Anti-Foreign Sanctions Law provides a stronger legal basis to the sanctions China has administered to date. However, as Joe Cash writes, this is not necessarily a cause for alarm, as companies should remember that ‘blocking statutes’ are pieces of legislation that all sophisticated actors in international trade have, but few use<\/h2>\n

On 10 June, the Standing Committee of China\u2019s National People\u2019s Congress approved a sweeping law designed to counter foreign sanctions on Chinese officials and major Chinese companies. Signed into law the same day through a presidential order by Xi Jinping<\/a>, the new measures codify a number of retaliatory actions that Beijing has already taken in response to Western sanctions. But the Anti-Foreign Law is very broadly written, meaning that foreign companies trading with China might fairly easily find themselves within the geopolitical crosshairs, despite their efforts to avoid this.<\/p>\n

This briefing explains the new Anti-Foreign Sanctions Law, how it differs from what has come before, and how UK companies trading in and with China should consider it now that both the UK and China have applied tit-for-tat sanctions against each another.<\/p>\n

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Background<\/h4>\n

The Anti-Foreign Sanctions Law is the latest piece of legislation to emerge from a trade-defence-instrument-promulgation-plan that Beijing has been working on for close to a decade. In January 2021, the Chinese government updated the \u2018Unreliable Entities List\u2019 and the \u2018Measures for Security Review of Foreign Investment.\u2019 Later in the month, China\u2019s Ministry of Commerce<\/a> (MOFCOM) issued new \u2018blocking rules\u2019 to target Secondary Sanctions \u2013 i.e. the application of sanctions in third countries \u2013 in situations where China considers its companies to be being unfairly and \u201cunjustifiably\u201d penalised by foreign parties, be they governments, businesses or individuals.<\/p>\n

Beijing has been working on its capability in the formulation of trade defence instruments since 2014. Back then, instruments \u2013 such as the Export Control Law<\/a> \u2013 were considered to be complex pieces of legislation that sophisticated actors in international trade should have, but they weren\u2019t considered to be a priority. Fast forward to the Trump Administration, however, and pieces of legislation that had been shelved were rushed into law to counter perceived US aggression in trade, and at least six laws and regulations that could be considered trade defence instruments were brought into law (2016, Foreign Trade Law; 2020 Foreign Investment Law; 2020 Unreliable Entity List; 2021 Rules of Counteracting the Unjustified ExtraTerritorial Application of Foreign Legislation & Other Measures; 2021 Personal Information Protection Law; and 2021 Anti-Foreign Sanctions Law).<\/p>\n