China is reacting against a flurry of US sanctions with new rules that protect its companies from “unjustified” foreign laws.
Changes announced over the weekend allow Chinese courts to punish companies that comply with such restrictions.
President Donald Trump has continued to target Chinese companies he believes are a threat to US national security.
Measures include punishing companies that supply parts to blacklisted companies.
On January 11, three large Chinese telecoms firms listed on the NYSE are expected to see their shares delisted based on alleged ties with its military.
The NYSE is removing China Mobile, China Telecom and China Unicom Hong Kong, based on an executive order signed by President Trump in November.
The de-listings follow a raft of actions against Chinese firms in recent months including TikTok, Huawei and microchip maker Semiconductor Manufacturing International Corporation (SMIC).
Last week, President Trump signed an executive order banning transactions with eight Chinese apps including popular payments platform Alipay, as well as WeChat Pay.
President Trump claims such tech companies share data with the Chinese government – allegations they have denied.
In a statement on January 9, China’s Ministry of Commerce introduced the new rules on “counteracting unjustified extra-territorial application” of foreign laws.
Bert Hofman, director of the East Asian Institute at the National University of Singapore, explained: “Legal persons that are hurt by the application of foreign legislation can issue legal proceedings in court and claim compensation for the damage done.
“The government can also take other countermeasures.”
The measures, which came into effect immediately, do not mention the US directly, although China has long complained about US sanctions and restrictions on trade.
However, legal experts say it is unclear how the new law will be implemented.
Angela Zhang, a Chinese law professor at the University of Hong Kong, said: “Consider a scenario that a European bank freezes the assets of a Chinese official that was sanctioned by the United States, the Chinese statute will allow the official to sue the European bank to recover his loss.”
A US aircraft has been “unprofessional” intercepted by two Chinese Sukhoi Su-30 jets, the US military said.
One of the Chinese jets came as close as 150ft to the US WC-135 plane and flew upside down above it, according to US officials cited by CNN.
According to the US military, the plane was on a mission to detect radiation in international airspace over the East China Sea.
Tensions have repeatedly risen over US activity near the resource-rich international waters off China’s coast.
The intercept, which took place on May 17, was deemed unprofessional “due to the maneuvers by the Chinese pilot, as well as the speeds and proximity of both aircraft”, Air Force spokesman Lt. Col. Lori Hodge said.
He said the issue was “being addressed with China through appropriate diplomatic and military channels”, and a military investigation was under way.
Image source Wikimedia
China has not commented on the incident, but it accuses the US of carrying out reconnaissance flights over Chinese coastal waters and regularly calls on the US to reduce patrols in the area.
It claims sovereignty over almost all of the disputed territory in the South and East China seas, though several other countries in the region have competing claims.
China has backed its expansive claims with island-building and naval patrols.
The US plane has previously been used to detect evidence of possible nuclear tests by North Korea.
Separately, China and South East Asian countries have agreed a framework for a long-awaited code of conduct for the disputed South China Sea, China’s foreign ministry said, without giving details on the content.
The draft will now be submitted to the foreign ministers of the countries in August.
Over the years, the US, China and several of the South East Asian countries have had disputes over rival activity in the South China Sea.
President Trump has said the US will “solve” the nuclear threat from North Korea, with or without China’s help.
In an interview with the Financial Times, Donald Trump said: “If China is not going to solve North Korea, we will. That is all I am telling you.”
Pressed on whether he thought he could succeed alone, President Trump replied: “Totally.”
Donald Trump was speaking ahead of a scheduled visit from Chinese President Xi Jinping this week.
“China has great influence over North Korea. And China will either decide to help us with North Korea, or they won’t. And if they do that will be very good for China, and if they don’t it won’t be good for anyone,” he told the Financial Times.
Asked if he meant “one-on-one” unilateral action, Donald Trump said: “I don’t have to say any more.”
The president did not give any further details on what action he would take.
Donald Trump’s brief comments, published just days before the key meeting with Xi Jinping at Trump’s Mar-a-Lago resort in Florida on April 6, are the latest in a series of warnings over North Korea’s nuclear development.
There are fears that North Korea could eventually develop the ability to launch long-range nuclear missiles capable of striking the mainland US.
A month earlier, Defense Secretary James Mattis warned that any use of nuclear weapons would be met with an “overwhelming” response.
However, President Trump is expected to put pressure on President Xi to do much more at their meeting this week – and he has implied that the issue of trade could be used as leverage.
Donald Trump told the Financial Times that “trade is the incentive. It is all about trade”. However, he said he did not plan to discuss tariffs during the meeting.
At the end of March, President Trump signed two executive orders to deal with the US trade deficit, reviewing current rules and foreign trade abuses.
White House officials insisted China was not the focus of his orders – but it is the largest source of the US trade deficit, accounting for about $347 billion a year, out of a total of $502 billion.
Donald Trump himself tweeted that “the meeting next week with China will be a very difficult one in that we can no longer have massive trade deficits”.
He has not said how he will negotiate trade with China while also pressing them to influence North Korea.
China is a historic ally of North Korea although ties have been strained in recent years. It has taken action in light of the reclusive nation’s latest missile tests.
Analysts say China has maintained its support for Pyongyang as it fears a complete collapse of the North Korean regime could lead to Korean unification, with US soldiers based in a country with a land border with China.
It is thought that China is also concerned at the prospect of millions of North Korean refugees entering its borders.
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