The passing by China’s top legislative body of an anti-sanctions law, including countermeasures to be taken against foreign powers, levels the playing field in its tense relationship with the United States. It follows waves of US sanctions principally targeting individuals in China, including Hong Kong, over the nation’s internal affairs and the administration of the Xinjiang Uygur autonomous region. The law provides a legal basis for Chinese counter-sanctions, previously imposed by administrative order. Legal backing could have far-reaching implications for effective implementation. As a result the new law will be closely scrutinised in government and corporate circles from America to Europe to Hong Kong for detail that could impact on officials and businesses or their partners. Some provisions mirror Western measures against Chinese and Hong Kong organisations and individuals, according to Tam Yiu-chung, Hong Kong’s only delegate to the Standing Committee of the National People’s Congress. They include the freezing of assets and institutional transactions with targeted individuals. Beijing has been discussing the latest step for some time, even before the US increasingly targeted China with sanctions. There was a need to come up with an effective response to sanctions on development partners in the Belt and Road Initiative. China unveils new legal weapon to hit United States and other Western rivals with tougher sanctions The targeting of China over the response to social unrest in Hong Kong gave it more urgency. Reliance on administrative orders lacked the legal clarity and certainty about how China might respond to sanctions, which did nothing to put pressure on foreign companies. Once aware of a serious legal risk, they may feel enough pressure to be prompted by self-interest to lobby their own governments on China’s behalf. The Hong Kong-related sanctions heightened Beijing’s resentment of the so-called long-arm jurisdiction of the US, which reflects soft power and dominance of finance, markets and technology. But the belief that it is quickly catching up has given Beijing confidence that it can mount effective retaliation measures. With this new law other players may take sides, potentially weakening the impact of US sanctions. There is some debate whether the law can apply to Hong Kong. From China’s point of view it’s more like a national law. In a sense it is not about whether it needs to be implemented in Hong Kong to be effective here, since so many foreign firms based here have business interests on the mainland that would be exposed to the law. That said, sanctions and counter-sanctions are not going to help anyone. They will force smaller countries to choose sides, which is not what anyone should want. Hopefully, the resumption of high-level official contacts between Beijing and Washington will lead to more constructive dialogue and less conflicted relations.