China passes anti-sanctions law to push back on Western pressure

Foreign Affairs

Beijing has quickly formulated and passed a new law to retaliate against any individual or organization who implements “discriminatory restrictive measures” — i.e. sanctions — against Chinese citizens or organizations, or those who “interfere in China’s internal affairs.”

li zhanshu, a senior chinese official, conducting a meeting in beijing with several other members of the national people's congress standing committee sitting beside him
Lì Zhànshū 栗战书, the third-most-senior official in Beijing and chairman of the National People's Congress (NPC) Standing Committee, presides over a meeting of the committee today. Image via Xinhua.

Since the summer of 2020, the U.S. has increasingly turned to sanctions in an attempt to punish Beijing for various offenses, particularly around human rights.

  • The Trump administration announced sweeping sanctions in response to the imposition of a national security law on Hong Kong and abuses against Muslim minorities in Xinjiang.
  • The Biden administration has continued the pressure using the same tools, but recruiting allies such as the European Union, Canada, and Britain in the process.
  • Beijing has retaliated by barring individuals and organisations in these countries from doing business in China, perhaps most notably 28 Trump administration officials as they left office and a large group of European officials, scholars, and organizations, leading to the freezing of a major EU-China investment deal.

China further beefed up its response to sanctions from Western countries today, as the Standing Committee of the National People’s Congress (NPC) approved a new anti-foreign sanctions law (text available in Chinese).

  • In the law, China reserves the right to retaliate against “any individual or organization that is directly or indirectly involved in the formulation, decision or implementation” of “discriminatory restrictive measures” against Chinese citizens or organizations, or those who “interfere in China’s internal affairs.”
  • In addition to those individuals and organizations, immediate family members of the individuals and senior management at designated organizations can be targeted.
  • Retaliation could include asset freezes, visa bans, travel restrictions, or “other necessary measures.”
  • The law is “China’s latest and most wide-ranging legal tool to retaliate against foreign sanctions and is intended to give Chinese retaliatory measures more legitimacy and predictability,” Reuters reports.

Foreign businesses are worried, partly because the bill was passed in an “expedited process without public consultation,” the Wall Street Journal reports.

  • Chinese leader Xí Jìnpíng 习近平 had indicated a need last November to develop laws to “better safeguard national sovereignty, security and development interests,” and the NPC reported in March that this was in the works, but the first reading of the draft bill in April was not public. The second reading was announced only two days ago, and a customary third reading of the bill was skipped, per Reuters.
  • Joerg Wuttke, president of the European Union Chamber of Commerce in China, told Reuters that the move was “not conducive to attracting foreign investment or reassuring companies that increasingly feel that they will be used as sacrificial pawns in a game of political chess.”