China Moves to Seize Foreign Assets Amid Supply Chain Tensions Tied to Iran Oil Conflict

China is reportedly preparing to expand its response to global supply chain disruptions, particularly amid heightened geopolitical tensions linked to Iran, according to a media report.

A source cited in the report said Beijing has introduced new regulations that could allow authorities to seize assets belonging to foreign governments or companies deemed to be interfering with China’s supply chains. The move is being viewed as a response to reported US actions involving the interception of Iranian oil shipments destined for China.

The source also suggested that Beijing is assessing wider strategic implications of US military constraints linked to the Iran conflict, including potential contingency planning related to Taiwan.

EXPANDING ECONOMIC PRESSURE TOOLKIT

A Reuters report dated April 27 provides broader context, noting that China has been steadily strengthening its economic countermeasures against the United States.

Despite signalling openness to continued dialogue, Beijing has taken several steps in recent months to bolster its ability to respond to US trade and technology restrictions.

Since the October summit between US President Donald Trump and Chinese President Xi Jinping, China has introduced measures including tighter rare earth export controls, restrictions on foreign AI chips in state-funded data centres, and limits on certain US and Israeli cybersecurity software used by Chinese firms.

The report also highlights new regulations targeting foreign entities seen as shifting supply chains away from China, as part of a broader effort to reinforce economic leverage ahead of a possible Trump–Xi meeting expected in mid-May.

NEW LEGAL POWERS AND STRATEGIC SIGNALS

According to Reuters, Chinese Premier Li Qiang signed new regulations in April granting authorities expanded powers to investigate and penalise foreign entities accused of undermining China’s industrial and supply chains. These measures reportedly include denial of entry, expulsion, and asset seizure provisions.

The timing of the regulations comes amid rising tensions over Iran, particularly after US Treasury Secretary Scott Bessent warned of sanctions on buyers of Iranian oil, around 80% of which is purchased by China.

Analysts cited in the report say Beijing’s approach reflects a longer-term strategy to build a comprehensive economic toolkit rather than purely reactive measures.

DEEPENING GLOBAL TRADE TENSIONS

The Reuters report also notes intensifying competition in sectors including semiconductors, rare earth minerals, and aviation. The United States has tightened export controls on advanced chip technologies, while China has responded by promoting domestic alternatives and restricting exports of key materials.

These moves have contributed to increasing strain on global supply chains, with analysts warning of wider economic ripple effects. A European Chamber in China report cited by Reuters cautioned that expanded extraterritorial controls could carry significant global consequences.