On August 25, 2026, the Anti-Cross-Border Corruption Law of the People's Republic of China (Draft) (the "Draft Law") was submitted to the 24th Session of the Standing Committee of the 14th National People's Congress for first reading, and was published for public comment on August 28, 2026. Comprising six chapters and 47 articles, the Draft Law is China's first piece of draft legislation specifically addressing cross-border corruption. This article offers an initial review from four perspectives — the regulated subjects, the procedural toolkit, the leniency design and the "blocking–countermeasures" framework — and submits that the Draft Law is in essence a composite of an organic law, a procedural law and a law of obligations. For "going-global" enterprises, the shift of cross-border compliance obligations from voluntary to mandatory is all but inevitable, and compliance systems should be built as early as possible.

Keywords: Anti-Cross-Border Corruption Law; cross-border corruption; corporate integrity compliance; anti-foreign sanctions; blocking and countermeasures; criminal risk

On August 25, 2026, the Anti-Cross-Border Corruption Law of the People's Republic of China (Draft) was submitted to the 24th Session of the Standing Committee of the 14th National People's Congress (NPC) for first reading; the bill was proposed by the National Commission of Supervision. From August 28, it was published on the NPC website for public comment¹, with the comment period closing on September 26. It is China's first draft legislation specifically regulating cross-border corruption, containing six chapters and 47 articles in the following order: General Provisions; Duties and Mechanisms; Case Handling and International Cooperation; Integrity Compliance; Legal Liability; and Supplementary Provisions.

A first reading of the full text suggests an overall judgment: the main point of this law is not what it punishes or how heavily it punishes — the Legal Liability chapter creates no new offenses and expressly sets no fine ranges — but rather whom it reaches, how the procedures operate, how leniency works and how it defends. It is in essence a composite of an organic law, a procedural law and a law of obligations, with substantive deterrence still resting on the Criminal Law and other special statutes. The discussion below addresses four questions in turn: how broad the regulated subjects are; what the procedural toolkit offers; what leniency and defense cards enterprises hold; and how the Draft Law, together with the Anti-Foreign Sanctions Law², the MOFCOM Rules on Counteracting Unjustified Extra-territorial Application of Foreign Legislation and Other Measures (the "Blocking Rules")³ and the newly enacted Regulations on Counteracting Unjustified Extra-territorial Jurisdiction⁴, forms a defense system.

Article 3 of the Draft Law defines "cross-border corruption" through a five-item enumeration which, when unpacked, operates at three levels.

(1) Two-way bribery of foreign officials

Item (1) covers both "bribery by domestic citizens and domestic enterprises, other organizations, their branches and subsidiaries to foreign public officials or officials of public international organizations" and "bribery committed within China by overseas persons and overseas enterprises, other organizations and their branches to foreign public officials or officials of public international organizations." Put simply: so long as the bribery is committed within China, it may fall within the Draft Law's jurisdiction even where the bribe-taker is an official of a third country and the bribe-giver is a multinational registered overseas. Unlike the extraterritorial expansion that the U.S. Foreign Corrupt Practices Act (FCPA) has long achieved through "minimum contacts" such as mail and U.S. dollar clearing, this follows the plainest territoriality principle. For foreign-invested enterprises in China, this is a new red line: once their China-related business conduct touches bribery, they may find themselves simultaneously subject to both the FCPA and Chinese law.

(2) Bribery of domestic officials from abroad and the "connected bribe-taking"

Item (2) brings within the definition "bribery by overseas persons and overseas enterprises, other organizations and their branches to domestic public officials and persons with a close relationship to them, or to state organs, state-owned enterprises, public institutions and people's organizations, as well as the bribe-taking conduct connected thereto." Writing the bribe-taking side squarely into the constitution of "cross-border corruption" is where this law parts ways with the U.S. FCPA. The FCPA punishes only the bribe-giver, and bribe-taking by foreign officials falls outside its scope; the Draft Law, by contrast, directly captures the operational patterns and features repeatedly seen in duty-related crime cases in recent years, such as siege by foreign capital and handling matters domestically while collecting money abroad, regulating both ends of bribery — giving and taking.

(3) Overseas duty-related conduct by domestic subjects and assets fled abroad

Item (3) covers embezzlement and bribery, abuse of power, dereliction of duty, power rent-seeking, improper transfer of benefits, practicing favoritism, wasting state assets and other duty-related violations or crimes committed overseas by domestic citizens and domestic enterprises, other organizations and their branches and subsidiaries; item (4) serves as a catch-all covering "other corruption of the same nature as the conduct specified in the preceding three items, where the conduct is wholly or partly committed abroad and its results occur wholly or partly within China"; item (5) also defines as "cross-border corruption" the conduct of corruption suspects fleeing abroad and transferring corrupt assets across borders. The third level dovetails with the nationality jurisdiction under Article 7 of the Criminal Law — paragraph 1 of which establishes the principle that crimes committed by Chinese citizens abroad are governed by China's Criminal Law (prosecution may be waived where the prescribed maximum penalty is not more than three years' imprisonment), while paragraph 2 provides that crimes committed abroad by state functionaries and military personnel are always governed by China's Criminal Law — and adds little substantively in itself; its significance lies in folding the procedural needs of fugitive pursuit and asset recovery into the definition.

Two gaps deserve attention here. First, the catch-all clause in item (4): although it requires conduct "of the same nature" as the preceding three items, this qualifier is rather vague, and the provision does not expressly require any particular degree of substantive connection between the place of conduct or results and China, leaving room for flexibility in practice. Second, "persons with a close relationship" in item (2): this expression has been used in judicial documents concerning duty-related crimes, but the Draft Law provides no definition, and whether it extends beyond close relatives (e.g., specific business partners or nominee holders) remains to be clarified. During the comment period, how these two boundaries should be defined warrants continued attention.

(4) Parent companies and overseas subsidiaries: extended jurisdiction

For the growing number of "going-global" Chinese-funded enterprises, the jurisdiction of this Draft Law lands on their subsidiaries. In items (1) and (3) of Article 3, "branches and subsidiaries" are listed alongside the domestic enterprise itself, meaning that bribery and other duty-related violations or crimes committed by overseas subsidiaries do not escape the Draft Law's jurisdiction merely because of their separate legal personality. It should be noted that direct criminal liability of an overseas subsidiary (a foreign legal person) still hinges on the actor's status as a Chinese citizen or state functionary (Article 7 of the Criminal Law). As to the domestic parent company, the Draft Law's main levers lie at both ends — obligations and liability: Article 29, paragraph 2 expressly extends the obligated subjects to "domestic enterprises that have established overseas branches or subsidiaries or conduct investment activities abroad," and also to "branches and subsidiaries established in China by overseas enterprises" — the latter half is equally noteworthy, as it means the compliance obligations in Chapter IV also fall on foreign-invested institutions located in China. Articles 30 to 34 require domestic enterprises to exercise management and supervisory responsibilities over their overseas institutions' compliance systems, financial management, third-party due diligence and employee training — most of these are "shall" obligations, but Article 30, paragraph 2 uses "may" for "formulating separate integrity compliance rules" for overseas institutions, which is hortatory in nature, a distinction that has been considered and drawn at the structural level; Article 31, paragraph 2 adds penetrating controls for state-owned enterprises, including directly dispatching overseas financial officers, rotation of expatriate staff and avoidance of conflicts of interest. Some views consider this approach somewhat similar to the FCPA's extension to overseas entities through the connecting point of "issuers and consolidated reporting entities" — the deeper the parent's actual control over an overseas entity, the stronger the connecting point for attribution and prevention. However, the Draft Law does not yet expressly adopt an "actual control" test; whether such a test can be established through implementing regulations and case practice remains a space for judicial interpretation to be observed.

At the enforcement level, the realization of jurisdiction rests on four levers: first, compliance obligations front-loaded, with the parent company bearing a statutory duty to supervise the compliance systems of its overseas institutions (Articles 29 to 34); second, mandatory reporting — enterprises that discover suspected cross-border corruption issues must "report to the supervisory organs, public security organs and other relevant organs in accordance with law" (Article 31, paragraph 1), making leads from overseas subsidiaries the trigger point for domestic accountability; third, nationality-based accountability of expatriate personnel, with corrupt conduct by dispatched state functionaries performing duties abroad directly governed by Article 7, paragraph 2 of the Criminal Law; and fourth, penetrating regulation by industry regulators — Article 10 requires the commerce, state-owned assets supervision, market regulation and financial regulation authorities, together with the supervisory organs and public security organs, to establish long-term industry mechanisms for anti-cross-border corruption, monitoring, analyzing and warning against cross-border corruption risks in relevant sectors. In fact, Article 4 of the Guidelines on Integrity and Compliance of Enterprises Operating Abroad issued by the Ministry of Commerce (MOFCOM) in 2025 (Shang He Han [2025] No. 189)⁵ already makes clear that "where an enterprise or its employees commit overseas corruption, they will bear corresponding criminal, administrative and civil liability under both domestic and foreign law"; Articles 3 and Chapter IV of the Draft Law can be seen as elevating this policy tone into statutory obligations. In a word: no immunity merely because the conduct occurs overseas; no insulation merely because the subsidiary has separate legal personality.

The AllBright Zeng Zheng legal team reminds "going-global" enterprises to promptly review the compliance status of their overseas branches and subsidiaries and to bring the integrity risks of overseas subsidiaries and third parties into a unified risk assessment framework, so as to avoid underestimating criminal risk under the illusion of separate legal personality or offshore operations.

(5) Competing jurisdiction: not yet answered squarely by the Draft Law

The Draft Law gives no formal answer to "how to choose when Chinese jurisdiction conflicts with foreign jurisdiction" — and this restraint is sensible, given that competing jurisdictional claims raise complexities touching far too many aspects. The relevant provisions number only three, all relatively indirect: Article 4 establishes the position of respecting sovereignty, equality and reciprocity, and advocating that the United Nations Convention against Corruption (UNCAC) play the role of the main channel — a posture declaration; Article 27 permits refusal to provide assistance to foreign authorities in circumstances such as ongoing investigation, criminal investigation, prosecution or trial in China, or where a final judgment has been rendered, criminal proceedings terminated, or the limitation period for prosecution expired — embodying the legal principle of "res judicata prevails," yet it is merely a discretion to "refuse," not a mandatory exclusion, leaving room for judgment; the countermeasures and blocking in Articles 6 and 26 are confrontational tools addressing the question of preventing the other side's unilateral enforcement, not the question of who holds priority jurisdiction. On the whole, the Draft Law's attitude toward competing jurisdiction is closer to "each asserting its own and neither recognizing priority," rather than the comity principle or lis pendens coordination mechanisms of private international law. At the convention level, the UNCAC likewise, taking territorial jurisdiction as its base, establishes no mandatory rules for resolving competing claims, and parallel assertions of jurisdiction by multiple states are mainly resolved through consultation.

Similar provisions already exist in domestic law: Article 8, item (2) of the Extradition Law provides that where, at the time the extradition request is received, the judicial organs of the People's Republic of China have rendered a final judgment, or terminated criminal proceedings, with respect to the offense for which extradition is requested, extradition shall be refused — the most rigid expression of "first-come, first-served" in domestic law. Ne bis in idem is likewise commonly listed as a ground for refusing extradition in the bilateral extradition treaties China has concluded. Yet the Draft Law refrains from mechanically elevating this logic into a clause on jurisdictional conflicts — also a sign of legislative prudence.

Looking ahead, the risk of competing jurisdiction in reality may not be remote: a Chinese enterprise pays bribes within China to an official of a Southeast Asian country; the place of conduct is in China, the bribe-taker's home state is abroad; add in U.S. dollar clearing or the listing of an affiliate in the United States, and three jurisdictions may simultaneously assert jurisdiction over the same conduct, with no adjudication or yielding rules today. The mainstream scholarly proposal is to adopt genuine connection (substantive place of conduct, place of results, and victim-interest connecting points) as the criterion for assessing the legitimacy of jurisdiction, and to write res judicata recognition and ne bis in idem into specific clauses through bilateral mutual legal assistance agreements and extradition treaties. These can, in truth, only be hoped for from future judicial assistance practice supported by international or bilateral treaty systems.

The official briefing summarizes the legislative necessity as solving the "difficulties of detection, evidence-taking, asset recovery and conviction" in cross-border corruption. Chapter III of the Draft Law (Articles 17 to 28) is precisely the tool-based response to these four difficulties, and merits closer study.

Detection. Article 17 establishes a general right to report: any organization or individual has the right to report cross-border corruption, and the relevant organs shall handle reports in a timely manner in accordance with law, keep the informant confidential, and give rewards and protection to informants who provide effective information in accordance with regulations. Coupled with the anti-money laundering monitoring under Article 13 — the State Council's anti-money laundering administrative authority or its dispatched offices at or above the level of cities divided into districts may, upon discovering suspicious transactions related to cross-border corruption, conduct investigations in accordance with law and promptly transfer leads and evidentiary materials to the supervisory organs and public security organs — and the transfer of leads from supervision and inspection by the auditing, finance, taxation and financial regulatory authorities, plus the customs notification mechanism regarding cash and bearer negotiable instruments carried across the border under Article 14, the Draft Law weaves a multi-source lead network at the "detection" stage. Funds monitoring is the most substantial link: the money trail of cross-border corruption must ultimately pass through the financial system, and the interface between the administrative investigation power over suspicious transaction reports and criminal investigation directly determines the rate at which leads become cases.

Prevention of flight. Article 12 requires the supervisory organs, together with the relevant organs, to strengthen supervision and rectification of public officials who acquire foreign nationality or obtain permanent residence or long-term residence permits abroad in violation of regulations, to improve the reporting system for public officials' overseas deposits and investments, and to establish and improve early warning, blocking and accountability mechanisms for preventing flight and cross-border transfer of corrupt assets. Article 19 provides the rigid measures: to prevent persons suspected of corruption from fleeing abroad, exit restriction measures may be decided in accordance with the conditions and procedures prescribed by law and enforced by the immigration administration.

Evidence-taking. Article 22 lists, by enumeration, the judicial assistance matters that may be requested from foreign authorities — twelve items in all, including locating and identifying persons, inquiring into and verifying property involved in the case and financial account information, obtaining testimony, obtaining documents, records, electronic data and objects, arranging for witnesses to testify or assisting investigations, sealing, seizing and freezing property involved in the case, and confiscating and returning illegal gains. Article 23 resolves the "admission" of foreign evidence: evidentiary materials obtained through international law-enforcement and judicial cooperation and judicial assistance channels may be used as evidence after examination finds them compliant with statutory requirements, except where an international treaty or agreement or China's commitment provides otherwise. This provision may seem technical, but it is in fact the hub of cross-border case handling — only when the legitimacy certification of overseas evidence-taking channels is opened can the "difficulty of evidence-taking" find an institutional outlet.

Fugitive pursuit and asset recovery. Article 24 prescribes four routes of fugitive pursuit — extradition, transfer of sentenced persons, repatriation and prosecution abroad; Article 25 prescribes a combination of asset recovery measures — law-enforcement and judicial cooperation, judicial assistance, confiscation of illegal gains and other procedures, as well as ordering restitution and accepting voluntary surrender of assets, and permits cooperation with foreign institutions on asset return and sharing. As to the procedural underpinnings, for suspects in embezzlement and bribery cases who have fled abroad, the Criminal Procedure Law already provides trial in absentia: Article 291 permits the case, after transfer by the supervisory organs or public security organs for prosecution, to be tried in absentia by the intermediate people's court at the place of the crime, at the place of the defendant's residence before departure, or designated by the Supreme People's Court; the proceedings for confiscation of illegal gains are likewise an existing institution. The Draft Law does not duplicate these procedural designs but overlays international cooperation channels on them — a structure of "reference plus cooperation" consistent with the referencing style of the Legal Liability chapter. It bears noting that the implementation of asset return and sharing is highly dependent on bilateral arrangements and the domestic law of the counterpart state, and in international practice is often the most difficult link in the asset recovery chain. Article 25, paragraph 2 is thus more declaratory than operational, and its follow-through will depend on bilateral treaty negotiations.

In addition, the customs facilitation of Article 20, the principles for handling foreign cooperation requests in Article 26, paragraph 1, and the information exchange and technical assistance of Article 28 also fill in, as far as possible, the remaining gaps in the cooperation framework. Viewed as a whole, Chapter III consolidates the cross-border procedural experience previously scattered across the International Criminal Judicial Assistance Law⁶, the Extradition Law⁷ and the Implementation Regulations of the Supervision Law⁸, functioning much like a codified "operational manual for cross-border case handling."

The Zeng Zheng legal team reminds that once the "four difficulties" obtain institutional outlets, the pace of enforcement may noticeably quicken. Enterprises with cross-border operations should establish in advance contingency plans for reporting response, internal investigation and evidence preservation, so as to fulfill their statutory duties when cooperating with investigations while protecting the procedural rights of the enterprise and the individuals involved.

Article 43 of the Draft Law sets out a list of mitigating circumstances at the level of administrative punishment and disciplinary measures: voluntary surrender and truthful confession; active cooperation with the investigation and proactive provision of relevant materials; proactive remedial measures, active return of illegal gains, and effectively reducing or avoiding losses; reporting others verified to be true; and other circumstances prescribed by laws and regulations. Article 42 correspondingly sets out aggravating circumstances (five items, including repeated commission, recommission after having been held liable, refusal to surrender or return illegal gains, and causing serious harm to national interests and social public interests). Article 41 addresses the apportioned liability of joint violations, with abettors and aiders punished according to their conduct. At the criminal level, the Draft Law incorporates the Criminal Law by reference — the existing leniency ladder remains effective. For example, Article 164, paragraph 4 of the Criminal Law provides that "a briber who voluntarily confesses the bribery before being prosecuted may be given a mitigated punishment or be exempted from punishment," a paragraph covering both the bribe-givers under paragraph 1 (bribery of non-state functionaries) and paragraph 2 (bribery of foreign public officials or officials of public international organizations). It should be noted that not all bribery defined in Article 3, item (1) of the Draft Law meets the "relatively large amount" threshold for criminalization of that offense, which again confirms the judgment at the outset of this article: substantive deterrence still relies mainly on the Criminal Law and supporting special statutes, and this law itself does not directly create offenses.

Some parts left blank in the Draft Law also merit reflection.

First, it provides no compliance defense clause. Section 7 of the UK Bribery Act creates the offense of failure of commercial organizations to prevent bribery while allowing enterprises to defend with "adequate procedures"; in U.S. FCPA enforcement practice, effective compliance programs, voluntary disclosure and full cooperation are the common currency for obtaining non-prosecution agreements (NPAs), deferred prosecution agreements (DPAs) and fine discounts. Chapter IV of the Draft Law imposes a full checklist of compliance obligations on enterprises engaged in cross-border business — institution building throughout the decision-execution-supervision process, risk identification and assessment, internal reporting mechanisms, true and complete accounting records, third-party due diligence, and employee training (Articles 29 to 34), with additional requirements for state-owned enterprises such as directly dispatched overseas financial officers, rotation of expatriate staff and avoidance of conflicts of interest (Article 31, paragraph 2) — yet for the time being Chapter V contains no express provision recognizing that "effective compliance" may preclude or mitigate liability. All the mitigating circumstances in Article 43 point to post hoc attitudes (surrender, cooperation, return of gains, reporting others); none points to ex ante system building.

This is indeed a rather complex legal question. Against the background that the current amendment of the Criminal Procedure Law likewise provides no express procedural basis, it is difficult for the Draft Law to grant compliance systems any defensive effect or an independent leniency channel — mirroring the reality that the domestic compliance incentive regime itself still awaits legislative confirmation. Understandable, but still a genuine risk exposure for enterprises; after all, enterprises are profit-making entities, and compliance simultaneously entails substantial costs.

Second, compliance obligations are independently sanctionable. Article 45 provides that an enterprise engaged in cross-border business that fails to perform its integrity compliance obligations under this law shall be ordered to rectify within a prescribed time limit; where it refuses to rectify, its relevant business may be ordered suspended, it may be ordered to suspend operations for rectification, or its relevant business licenses may be revoked. This means that breach of the compliance obligations alone constitutes independent liability, without any actual occurrence of corruption — a more stringent obligation-based design than the FCPA's accounting provisions, and it also supersedes the state of affairs under the Guidelines on Integrity and Compliance of Enterprises Operating Abroad, where compliance was merely an advisory requirement.

Third, and with the most direct impact on enterprises: the reporting obligation. Article 31, paragraph 1 of the Draft Law requires enterprises that "discover suspected cross-border corruption issues" to "report to the supervisory organs, public security organs and other relevant organs in accordance with law." Article 44 further hardens the duty to cooperate: refusal to provide evidentiary materials, concealment, falsification or destruction of evidence, or refusal or obstruction of an investigation will lead to an order of rectification; where it constitutes a violation of public security administration or a crime, punishment shall follow in accordance with law. Combined, the two provisions mean that problems discovered by a compliance system must be reported to the relevant organs, with virtually no buffer zone. For enterprises simultaneously subject to foreign law, how internal investigation records are used, to whom they are disclosed, and whether they can resist demands for production by foreign enforcement agencies may all become practical difficulties going forward.

Taken together, Chapter V builds a complete liability ladder: where a crime is constituted, criminal liability under the Criminal Law (Article 35); where administrative order is violated, punishment by the competent authorities, with double punishment of the directly responsible persons in charge and other directly liable persons where an entity violates the law (Article 36); disciplinary measures against public officials by the supervisory organs or the appointing organs and entities (Article 37); civil liability for damages caused (Article 38); recording in credit records upon punishment, with employment prohibitions or restrictions under laws and regulations applying accordingly (Article 39); confiscation, recovery or ordered restitution of illegal gains, fruits and proceeds (Article 40); accountability under the Public Security Administration Punishments Law or the Criminal Law for refusing to cooperate with investigations (Article 44); and qualification penalties ranging from ordered rectification to suspension of business, suspension for rectification and license revocation for failure to perform compliance obligations (Article 45). In addition, the Draft Law also specifically restrains the enforcement personnel themselves: Article 46 provides that personnel of the supervisory, public security and other organs who abuse power, neglect duty, practice favoritism or disclose state secrets, work secrets, trade secrets, personal privacy or personal information in violation of regulations in anti-cross-border corruption work shall be subject to disciplinary measures and, where a crime is constituted, criminal liability.

In sum, the incentive structure the Draft Law offers enterprises is this: a compliance system cannot buy exemption or a defense, but it can buy three things — avoidance of qualification penalties (Article 45), entry into the leniency ladder when something occurs (Article 43), and the shelter of rules amid the conflict between cooperating with domestic investigations and responding to foreign enforcement. The function of corporate compliance has shifted from a talisman to a passport.

The AllBright Zeng Zheng legal team submits that enterprises should invest in compliance with the expectation of a passport rather than a talisman: investment in compliance systems, though it cannot buy statutory exemption, is the realistic premise for avoiding qualification penalties, entering the leniency ladder and obtaining the shelter of rules amid cross-border enforcement conflicts.

The text of the Draft Law visibly embeds interfaces with existing foreign-related legal instruments.

The first interface is countermeasures. Article 6 provides that where a foreign state, in violation of international law and the basic norms governing international relations, "under the pretext of anti-corruption or through improper extra-territorial application of its domestic law," contains, suppresses or takes discriminatory restrictive and other improper measures against China's citizens, enterprises and other organizations, "China has the right to take countermeasures, blocking and other corresponding measures in accordance with the Anti-Foreign Sanctions Law of the People's Republic of China and other relevant state provisions." This wording almost inherits the sentence structure of Article 3 of the Anti-Foreign Sanctions Law, which sets "containing or suppressing China under various pretexts or on the basis of its domestic law" as the general premise for the right of countermeasures; the Draft Law merely concretizes "under various pretexts" into "under the pretext of anti-corruption." This means that, in certain scenarios, if the United States were to take discriminatory measures against Chinese enterprises on the basis of the FCPA beyond enforcement itself (such as list-based restrictions), China could directly initiate the countermeasure procedures under the Anti-Foreign Sanctions Law regime without seeking another basis.

The second interface is the blocking of domestic enforcement activities. Article 26, paragraph 2 of the Draft Law provides: "Without the consent of the relevant organs of China, no foreign institution, organization or individual may conduct law-enforcement activities such as anti-cross-border corruption investigations within the territory of China, by itself or through others; and institutions, organizations and individuals within China shall not provide evidentiary materials or other relevant assistance to foreign institutions, organizations or individuals. Where China's laws are violated, blocking and other corresponding measures shall be taken in accordance with the relevant state provisions, and legal liability shall be pursued in accordance with law." This is the provision with the strongest defensive character in the whole draft.

This provision has two institutional lineages. The first is the MOFCOM Blocking Rules. Targeting situations where the extra-territorial application of foreign laws and measures unjustifiably restricts normal economic and trade activities between Chinese enterprises and third countries, the Rules establish a work reporting obligation, a prohibition-order system and penalties for violations, and allow enterprises injured by compliance with a prohibition order to sue the beneficiaries in court for damages. It merits particular note that the Rules long existed "with institutions but without practice" — until May 2, 2026, when MOFCOM issued Announcement No. 21 of 2026, for the first time issuing a blocking order declaring that the U.S. sanctions imposed on Hengli Petrochemical and four other Chinese enterprises in connection with Iranian oil transactions "shall not be recognized, enforced or complied with," bringing the blocking regime into actual operation. Article 26 of the Draft Law writes "no enforcement within China, no provision of evidence assistance abroad" directly into law at the statutory level, and replaces the MOFCOM-led mechanism with one led by the National Commission of Supervision, markedly enhancing its enforcement rigidity. The second is Article 12 of the Anti-Foreign Sanctions Law: "No organization or individual may execute or assist in the execution of discriminatory restrictive measures taken by foreign states against China's citizens and organizations. Where an organization or individual violates the preceding paragraph and infringes upon the lawful rights and interests of China's citizens or organizations, China's citizens or organizations may bring a lawsuit before a people's court in accordance with law, requesting cessation of the infringement and compensation for losses."

It should also be noted that Articles 6 and 26 of the Draft Law are not isolated provisions, but are embedded in a toolkit that is still expanding: in March 2025, the State Council promulgated the Regulations on the Implementation of the Anti-Foreign Sanctions Law⁹; on April 7, 2026, the State Council promulgated the Regulations on Counteracting Unjustified Extra-territorial Jurisdiction (State Council Order No. 835), establishing an institutional framework for the identification, blocking and countermeasures against unjustified extra-territorial jurisdiction of foreign states, with mechanisms including "prohibition-of-execution orders," a list of malicious entities, and exemptions and remedies, further consolidating the defense system. Once the Draft Law is enacted, blocking and countermeasures in the anti-cross-border corruption field will acquire a dedicated legal interface within this toolkit.

With the three instruments interlocked, the situation facing enterprises confronted by foreign anti-corruption enforcement is about to undergo a structural change. Imagine the headquarters of a foreign-invested enterprise in China receiving an FCPA investigative demand from the U.S. Department of Justice requiring its Chinese subsidiary to produce documents — under U.S. law this is a compulsory obligation; yet Article 26, paragraph 2 of the Draft Law in principle prohibits domestic institutions and individuals from providing evidentiary materials and other assistance abroad; and Article 12 of the Anti-Foreign Sanctions Law prohibits assisting in the execution of discriminatory restrictive measures. With these three vectors pitted against one another, how enterprises should choose between them will be a question well worth exploring in both theory and practice.

At the same time, the Draft Law also offers some exits: first, the reciprocity clause of Article 18, paragraph 2 — foreign subjects may, in accordance with law, be required to cooperate with our side, while our side handles foreign requests in accordance with Chinese law and treaties (Article 26, paragraph 1); second, the Blocking Rules themselves provide a case-by-case exemption mechanism under which enterprises may apply in writing for exemption from compliance with a prohibition order on grounds of special difficulties — whether this channel can be preserved in the Draft Law era and extended to the scenario of "providing evidentiary assistance" is a question worth raising during the comment period. A rule-based exemption application mechanism may be the only practical path to extract enterprises from the case-by-case game of being "penalized at both ends."

On February 10, 2025, the President of the United States signed an executive order pausing FCPA enforcement for 180 days and initiating a review; in June of the same year, the U.S. Department of Justice issued new guidelines resuming enforcement, explicitly concentrating enforcement resources on cases protecting U.S. economic and national security interests¹⁰. At a moment when FCPA enforcement is contracting and becoming instrumentalized, China's launch of dedicated legislation objectively constitutes a supply of rules amid the restructuring of the global anti-corruption enforcement landscape. This background should not be over-dramatized as "seizing the moment," but it does show that for "going-global" enterprises, the uncertainty of extra-territorial anti-corruption enforcement is rising rather than falling, which in turn highlights the practical significance of the defensive provisions.

The Zeng Zheng legal team reminds foreign-invested enterprises operating in China to establish a dual compliance decision-making mechanism as early as possible: for matters that may simultaneously trigger the Anti-Foreign Sanctions Law, Article 26 of the Draft Law and the cross-cutting obligations of cross-border data transfer regulation, professional assessment should be obtained in advance, so as to avoid the passive situation of being penalized at both ends in individual cases.

The framework of the Draft Law is in place, but there are four gaps that merit further study: first, the boundary of the catch-all definition in item (4) and of "persons with a close relationship"; second, the supporting measures for the reference-based design of the Legal Liability chapter — the fine ranges and the difference between the "improper commercial benefits" of bribe-givers and the "undue advantage" of the Convention all await follow-up by the Criminal Law and special statutes, and the supporting instruments outside this law will determine its real deterrent force; third, the exemption and coordination mechanisms — without exemption channels for domestic evidence-taking assistance, rules on the use of internal investigation materials, and interface with cross-border data transfer regulation, the obligation checklist in Chapter IV will be difficult to implement; and fourth, positive rules on competing jurisdiction — whether "res judicata prevails" can be generalized from the extradition field, and how bilateral treaties should carry it, merit consideration together in the legislative amendment and supporting negotiations.

The effective date is left blank in Article 47, and the Draft Law must still go through the second and third readings. But one thing is certain: the shift of cross-border compliance obligations from "voluntary" to "mandatory" will most likely become a reality when this law takes effect. On the whole, the Draft Law is certainly not a simple "Chinese FCPA" — it reaches more broadly, punishes more lightly, asserts jurisdiction more modestly, and defends more vigorously. For "going-global" enterprises, what needs to be done now is not to wait for the text to be finalized, but to start building the compliance ledger — because from the structure of Article 45, by the time it is supplemented, it will already be too late.

Full text of the Anti-Cross-Border Corruption Law (Draft): http://www.npc.gov.cn/flcaw/userIndex.html?lid=ff8081819ff541ea01a03d59794f46c9