On March 24, 2025, China officially enacted the Provisions on the Implementation of the Anti-Foreign Sanctions Law of the People’s Republic of China under State Council Decree No. 803. These new regulations establish a structured legal framework for enforcing countermeasures against foreign sanctions, aiming to protect China’s sovereignty, security, and economic interests. The Anti-Foreign Sanctions Law (AFSL), originally passed in 2021, laid the groundwork for China’s ability to respond to restrictive measures imposed by foreign governments. The newly issued provisions provide more detailed guidelines on how these countermeasures will be implemented, clarifying enforcement mechanisms, outlining the roles of different government departments, and specifying the legal obligations of individuals and organizations affected by foreign sanctions.
Key Aspects of the Implementation Provisions:
Legal Authority and Scope
The provisions are based on the Foreign Relations Law and AFSL, reinforcing China’s right to take countermeasures against foreign governments, organizations, and individuals that impose discriminatory restrictions on Chinese entities. The new rules specify that China’s response will be guided by the principles of national security and economic protection.
Under these regulations, if a foreign entity engages in activities that harm China’s national interests—such as restricting trade, investment, or access to financial services—the State Council has the authority to take countermeasures. These include restrictions on transactions, visa denials, asset freezes, and other economic measures.
Designation of Sanctioned Entities
One of the key provisions outlines the process for designating foreign individuals and organizations subject to countermeasures. The decision to impose sanctions will be made by relevant State Council departments, including those overseeing foreign affairs, commerce, financial regulation, and national security. Once a designation is made, the government will publicly announce the targeted entities and the specific measures being implemented.
Scope of Countermeasures
China’s countermeasures under the new provisions extend across multiple sectors, including:
- Visa and Entry Restrictions – Denying entry, revoking visas, and deporting affected individuals.
- Financial and Asset Freezes – Seizing or freezing bank accounts, securities, equity holdings, and other financial assets of sanctioned entities.
- Trade and Investment Restrictions – Prohibiting or limiting sanctioned entities from engaging in imports, exports, and domestic investments.
- Data and Technology Controls – Restricting the transfer of data, personal information, and intellectual property.
- Sectoral Limitations – Banning sanctioned entities from participating in China’s educational, scientific, legal, environmental, cultural, and tourism sectors.
Coordination Among Government Departments
The regulations mandate close coordination among various government agencies to ensure consistent enforcement of countermeasures. Departments responsible for foreign affairs, commerce, financial regulation, and cybersecurity will work together to monitor foreign sanctions and ensure that countermeasures are implemented effectively.
Additionally, legal service providers such as law firms and notary bodies are encouraged to support affected Chinese businesses and individuals, providing legal assistance in responding to foreign sanctions and pursuing litigation when necessary.
Legal Remedies and Compliance Obligations
Entities placed on China’s counter-sanctions list have the right to appeal for modification or removal. The provisions allow sanctioned organizations and individuals to submit applications to the relevant State Council departments, providing evidence of corrective measures or changed circumstances.
Furthermore, Chinese entities are explicitly prohibited from enforcing or assisting in the enforcement of foreign sanctions against Chinese citizens and businesses. Companies that fail to comply with China’s countermeasures may face legal penalties, including restrictions on government contracts, bidding opportunities, and trade privileges.
Implications for Businesses and Global Trade:
For Multinational Corporations
Foreign companies operating in China will need to navigate an increasingly complex regulatory environment, balancing compliance with both Chinese counter-sanctions and foreign sanctions imposed by other governments. Businesses involved in sensitive sectors such as finance, technology, and trade must conduct thorough risk assessments and ensure compliance with local laws.
For Domestic Enterprises
Chinese companies impacted by foreign sanctions may benefit from the government’s countermeasures, as the provisions offer legal recourse for businesses affected by restrictions on trade, finance, or supply chains. Domestic firms should stay informed about evolving regulations and leverage legal mechanisms to protect their interests.
For Global Trade and Diplomacy
The implementation of these provisions signals China’s commitment to pushing back against foreign sanctions, reinforcing its stance on economic sovereignty and national security. This could lead to heightened geopolitical tensions, particularly in areas such as technology, finance, and investment. Businesses and investors will need to closely monitor regulatory developments to mitigate risks associated with changing diplomatic relations.
Conclusion
China’s new implementation provisions under the Anti-Foreign Sanctions Law mark a significant step in its efforts to counter foreign restrictions and protect national interests. By formalizing enforcement mechanisms and clarifying the roles of various government agencies, these regulations provide China with a legal framework for responding to external economic pressures.