China Drafts Law to Sue Foreign Entities Over National Interests

Senior lawmakers in Beijing have reviewed a draft bill allowing state prosecutors to sue foreign individuals and organisations for alleged damage to national interests. The legislative session examining the proposed law on "procuratorial public-interest litigation" concluded on Friday, according to the Wall Street Journal.

The draft provision states prosecutors "may initiate public-interest litigation against unlawful acts committed by foreign organisations or individuals that infringe on" China's national and public interests, according to state media.

However, Beijing has not yet specified what exact acts would be subject to this litigation or what specific interests the law would protect. The provision, if approved, would buttress existing Chinese law that already allows Chinese companies and individuals to file civil suits against foreign parties to seek compensation for losses caused by foreign sanctions. China’s legislature solicited public feedback on an earlier draft of the bill late last year.

Experts expect passage by late 2026, the report said. Most bills receive formal approval following a third legislative reading, which legal analysts suggest will occur by the end of the year.

Targeting Foreign Coercion

State media outlined the rationale. The official newspaper of China's top prosecutorial agency recently published essays advocating civil suits to combat outside interference and "long-arm jurisdiction".

The publication said that in response to "threats to the security of key industrial and supply chains or the blockade of important technologies, procuratorial agencies can explore initiating public-interest litigation to demand cessation of such infringements and compensation for losses".

Western governments have previously imposed economic sanctions against the state. These measures targeted Beijing's industrial policies, its treatment of Muslim minorities in Xinjiang, and restrictions on civil liberties in Hong Kong.

In 2021, Beijing adopted an "antiforeign sanctions law" that prescribed mechanisms for retaliating against foreign sanctions. More recently, Beijing announced new regulations this year mandating punitive actions against foreign groups and individuals who threaten China’s access to vital resources or drop Chinese suppliers in response to political pressure. The rules also target foreign parties who assert "unjustified extraterritorial jurisdiction" over Chinese entities and people.