China has rolled out tough new rules aimed at countering foreign sanctions, explicitly linking the measures to U.S. threats of secondary sanctions on Chinese banks over Iranian oil purchases and warning that further retaliation tools are likely to follow, the Financial Times reported.

The new measures, announced this month, are designed to shield Chinese companies and supply chains from what Beijing sees as extraterritorial pressure from foreign governments, according to the FT. The rules broaden the definition of interference in China’s commercial affairs and expose violators to severe penalties, including exit bans and potential detention of employees while investigations are underway.

A social-media account run by China Media Group, a Communist Party mouthpiece, pointed directly to U.S. sanctions pressure tied to the Iran war, as well as the cancellation of Hong Kong-based CK Hutchison’s port concessions in Panama, as examples of the “spillover risks” China now wants to confront. The account described the new regulations as only a “starting point” and said more foreign-related legislation was expected, the newspaper said. 

Known as orders 834 and 835, the rules are part of a broader Chinese legal architecture that can be used to punish companies that comply with foreign export controls or sanctions that restrict Chinese market access or imports, the FT said. They are also intended to stop intermediaries such as banks, logistics groups, and internet platforms from acting as enforcers of foreign sanctions regimes against Chinese entities.

Read more at the Financial Times