Chinese companies were banned from complying with foreign, including American sanctions. This is reported by the South China Morning Post.
According to the newspaper, the Supreme People's Court of China confirmed an important decision related to the application of the law "On countering foreign Sanctions." This decision, in fact, establishes that Chinese companies cannot unilaterally terminate contracts, referring to the sanctions of foreign states, and that such actions will be considered as a violation of Chinese law.
The court included a specific case in the list of "Typical Maritime Court Cases for 2025," officially calling it "the first case that clearly established the mandatory applicability of the Law on Countering Foreign Sanctions." This gave the case precedent significance.
We are talking about the case of the Singapore shipping Company, which refused to fulfill the contract of sea transportation due to the fact that the Chinese customer company (from Hong Kong) was sanctioned by the United States. The Singaporean company not only refused to issue the bill of lading, but also eventually turned the cargo back to Shanghai.
The Shanghai Maritime Court sided with the Chinese company and ordered the Singapore carrier to pay compensation in the amount of more than 4.99 million yuan (over 499 thousand US dollars), as well as interest, recognizing his actions as a gross breach of contract. The judge rejected the defendant's attempt to justify his actions by fear of US sanctions.
The Court applied article 12 of the Law "On Countering Foreign Sanctions", which expressly prohibits organizations and individuals from executing or assisting in the execution of discriminatory restrictive measures imposed by foreign states against Chinese citizens or organizations. Violation of this prohibition is the basis for filing a claim for damages in a Chinese court. This means that foreign companies cannot use third-country sanctions as a "green light" to violate contracts with Chinese partners.
Thus, this decision is a practical step by China to counteract the extraterritorial application of foreign laws (the so-called "long handshake") and protect the interests of national companies, setting a legal precedent for future disputes.