China Blocks Companies from Complying with US Sanctions
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- China invoked its blocking statute to publicly prohibit companies from complying with U.S. sanctions on five Chinese refineries processing Iranian oil.
- U.S. blacklisted five Chinese refineries for processing Iranian oil, prompting the Chinese response.
- China’s blocking statute, issued in 2021, allows firms to sue parties benefiting from foreign sanctions and authorizes state compensation; this is the first public directive to refuse compliance.
- China issued the blocking statute directive just days before a Trump‑Xi summit in Beijing.
- EU introduced a new round of sanctions on Russia, prompting public criticism from Beijing.
Why it matters: Chinese firms avoid costly U.S. sanctions penalties while U.S. exporters lose access to Iranian‑linked oil, tightening Beijing’s leverage ahead of the Trump‑Xi summit and indicating a tougher stance on Iran‑related trade.
