Sinica · China
TIER 4 Mon, 4 May 2026 14:01:30 +0000
Beijing's anti-sanction toolkit just got two powerful new additions.
͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏
| |
---|---|---
| | | Forwarded this email? Subscribe here for more
Beijing 's anti-sanction toolkit just got two powerful new additions.
Earlier this month, within a single week, the State Council released two regulations that sharply expand how Chinese authorities can push back against foreign sanctions, export controls, and extraterritorial enforcement:
Regulations on Industrial and Supply Chain Security (RISCS), released on April 7
Regulations on Countering Improper Foreign Extraterritorial Jurisdiction (RCIFEJ), released on April 13
Don 't mistake the back-to-back rollout for a knee-jerk reaction to external events. These are the latest moves in a multi-year effort to harden China's anti-sanction architecture.
Both regulations were approved at a State Council executive meeting in March, and drafting almost certainly began in 2025.
They come from Beijing's sober, long-term assessment of just how exposed China's industrial economy is to Western pressure.
The new regulations target two pain points Beijing has long struggled to address cleanly: How to prevent foreign governments from reaching Chinese companies under their own domestic laws, and how to prevent foreign actors from severing key links in China's supply chains.
RISCS is China 's first dedicated supply chain security regulation, giving the state legal cover to penalize foreign actors for disrupting Chinese supply chains -**** with potential countermeasures spanning immigration, trade, investment, international cooperation, and foreign aid.
It also tightens scrutiny of research into Chinese supply chains, complicating MNCs' efforts to map and manage their sourcing and third-party risk.
What's more, it grants the state emergency powers to compel businesses - including multinationals operating in China - to produce goods deemed critical to "economic, social, and national security."
The language is deliberately vague - covering foreign actions that "violate normal market principles, interrupt normal transactions, or impose discriminatory measures causing substantial harm to Chinese supply chain security."
RCIFEJ empowers the Ministry of Justice to designate specific foreign laws or enforcement actions that Beijing wants to block.
Once designated, all entities and individuals in China are prohibited from complying.
The Malicious Entity List adds visa bans, asset freezes, and trade restrictions for foreign businesses tied to formulating or enforcing those measures.
The regs mostly target government actors - but the lobbying clause is the kicker.
So what 's next?
Beijing 's best-case scenario is that the regs' existence alone will serve as a compelling deterrent.
That said, Beijing will likely take some action to show it means business - but not so much that it hands China hawks new ammunition to push for faster decoupling.
So we expect early tests of both regulations - but carefully calibrated ones.
Beijing's likely opening move will be to launch investigations against a handful of government actors as early warning shots, without imposing formal penalties.
Companies are likely safe for now, given the collateral damage to foreign investment and China's business environment that hitting them would entail.
Get smart: Regardless of whether Beijing ever follows through, the risks to foreign companies just went up a notch.
The bigger picture: Beijing is going on the front foot to protect its industrial base - and the work here's far from done.
Ether Yin, Partner and Head of Policy Research, Trivium China
China 's strategic patience with the EU is showing signs of strain.
On April 17, China's commerce ministry (MofCom) warned of retaliation if the EU moves forward with cybersecurity regulations that exclude Chinese tech products from EU markets.
Then, on April 24, MofCom placed seven EU entities on its export control list.
Finally, on Monday, MofCom took aim at the EU's proposed Industrial Accelerator Act (IAA), blasting the law as "institutional discrimination" and warning of possible countermeasures.
On Wednesday, a group of 73 House Democrats signed a letter to US President Donald Trumpurging him not to allow the import of Chinese cars to the US, warning of "profound and irreversible" damage to US automakers.
In January, Trump told the Detroit Economic Club that he was open to Chinese carmakers entering the US, saying: " I love that. Let China come in."
Trump could strike a deal to open the US auto market to Chinese participation during his upcoming state visit to China.
This could see high-quality, competitively priced Chinese EVs enter the US market, giving American automakers a run for their money.
An influential policy adviser is calling on Beijing toload up on off-balance-sheet debt to juice the economy.
Yin Yalin believes consumers are stuck in a negative feedback loop, where sluggish income growth leads to weak consumption growth - which in turn undermines income growth.
Fiscal support was heavily front-loaded in Q1, and much of Beijing's budgeted firepower for the year will be exhausted by end-June.
To avoid a fiscal cliff later in the year, Yin called for: " Studying options to expand ultra-long special treasury bond issuance in H2 to fund follow-on investment projects."
On April 24, DeepSeek finallyshipped its latest model - V4.
Despite the hype, the new model landed flat: It clearly lags behind leading US models, and it's not even obvious that it beats top domestic rivals.
However, V4 does come with deeper integration with Chinese chips - especially Huawei Ascend - and introduces a new model architecture designed to squeeze more out of limited compute.
On April 26, the Central Committee and State Council jointly released a high-level policy directive on strengthening the management of"new employment groups."
That covers China's roughly 84 million platform workers, including delivery riders, couriers, and ride-hailing drivers.
Through this policy, the Party is officially recognizing gig workers as a collective and distinct labor demographic.
That places gig workers alongside other major labor demographics like factory workers, service industry workers, and migrant workers, meaning they can benefit from targeted policy support.
On Tuesday and Wednesday, multiple outlets reported that state-owned oil majorsSinopec and CNPC are applying for permits to export gasoline, diesel, and jet fuel.
Beijing reportedly ordered a freeze on refined fuel exports in early March, halting shipments that had not cleared customs.
The move exacerbated shortages in parts of Asia, prompting several governments to quietly seek relief from Beijing.
For the first time in decades,an outsider is set to lead the Ministry of Agriculture and Rural Affairs (MARA).
On Wednesday, the Central Organization Department announced Zhang Zhu as MARA's new Party secretary, replacing Han Jun. Zhang will likely be appointed as minister soon.
Zhang has a very different profile from the last three MARA bosses - he has never worked in the central government, nor held a top provincial job.
By contrast, all of Zhang's predecessors since 2009 had experience governing a province, and all had spent decades shaping agricultural policy within central institutions.
As always, it was a busy week in China.
You 're currently a free subscriber to Sinica. Please support the work that I'm doing and upgrade to paid. 非常感谢！
Upgrade to paid
(C) 2026 The Sinica Podcast
548 Market Street PMB 72296, San Francisco, CA 94104
Unsubscribe