China
Essential Insights on China’s Anti-Foreign Sanctions Law: A Guide for Foreign Companies
On March 23, 2025, China’s State Council released regulations for the Anti-Foreign Sanctions Law (AFSL), which counters foreign economic sanctions. Key powers include imposing countermeasures against entities violating international norms, affecting foreign multinationals operating in China and abroad.
On March 23, 2025, the State Council released a new set of regulations guiding the implementation of China’s Anti-Foreign Sanctions Law (AFSL).
The AFSL, which came into effect on June 10, 2021, was formulated to provide the Chinese government with a legal toolkit to counter what it deems discriminatory or restrictive economic measures taken against its companies or citizens. The law has been widely interpreted as a mechanism to counter economic sanctions and restrictions imposed by the US in the wake of the Trump administration’s aggressive economic policies, as well as similar actions taken by the EU and other regions.
The AFSL is of particular concern to multinationals operating in both China and abroad, especially those with substantial operations in Western countries. This article outlines the key aspects of the new regulations, their implications for foreign companies, and recent cases of countermeasures implemented under the AFSL.
The most important power granted to the Chinese government by the AFSL is stipulated in Article 3, which states that China has the right to take corresponding countermeasures “if a foreign country violates international law and basic norms governing international relations, uses various pretexts or its own laws to contain and suppress China, adopts discriminatory or restrictive measures against Chinese citizens and organizations, and interferes in China’s internal affairs”.
Moreover, the AFSL enables the State Council to include individuals and organizations that “directly or indirectly participate in the formulation, decision, and implementation of discriminatory restrictive measures” on the “countermeasure list”.
The following people and organizations can also be added to the countermeasure list:
| This article was first published by China Briefing , which is produced by Dezan Shira & Associates. The firm assists foreign investors throughout Asia from offices across the world, including in in China, Hong Kong, Vietnam, Singapore, and India . Readers may write to info@dezshira.com for more support. |
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