Commentary: The Problem With China’s New Rules on Foreign Sanctions

An overview

Drawing inspiration from the European Union’s legal practice, China has created a similar legal regime for counteracting the impact of foreign sanctions on Chinese persons. On Jan. 9, the Ministry of Commerce (MOFCOM) issued “Rules on Counteracting Unjustified Extraterritorial Application of Foreign Legislation and Other Measures” (the Chinese Blocking Statute). While the law is effective immediately, it is not yet fully operational. So far, only a basic legal framework has been established in relation to “sanctions,” “injunctions” (i.e., by China to counteract the “sanctions”), “exemptions” (from the “sanctions”) and “litigations” (to sue those who complied with the “sanctions” or benefited from the “sanctions”). The order will only become operational when the Chinese government further substantiates it.