A Chinese businessman was sentenced to 30 years in a US federal prison this week, prompting a sharp warning from the British Foreign Office that Washington’s pursuit of extraterritorial jurisdiction risks destabilising global norms. The case, which centres on alleged violations of American sanctions against North Korea, has exposed deepening transatlantic fissures over the reach of US law.
The tycoon, identified as Cheng Hong, 54, was convicted in a New York court in March on charges of conspiring to evade US sanctions and money laundering. Prosecutors argued that he orchestrated a network of shell companies to funnel luxury goods and petroleum to North Korea, in defiance of American prohibitions. His sentence, handed down on Monday, is one of the harshest ever imposed on a foreign national for sanctions-related offences.
London has reacted with unusual force. In a statement issued late Tuesday, a Foreign Office spokesperson said: “The United Kingdom is deeply concerned by the lengthy sentence handed to a Chinese national under US laws applied beyond American territory. Extraterritorial enforcement of sanctions, when not rooted in multilateral agreement, risks fragmenting the international legal order and undermining diplomatic resolution of disputes.” The statement added that Britain would raise the matter in forthcoming consultations with both Washington and Beijing.
The case highlights a growing tension between the United States and its allies over the use of unilateral sanctions as a foreign policy tool. While the US has long imposed penalties on entities trading with Iran, North Korea and Venezuela, its aggressive pursuit of foreign defendants has strained relations even with close partners. European Union officials have previously criticised American “secondary sanctions” as a violation of international law, but Britain’s public intervention marks a notable escalation in diplomatic posture.
For Beijing, the sentencing is a further irritant in bilateral ties already strained by trade disputes, technology competition and the Covid-19 origin controversy. The Chinese embassy in Washington denounced the ruling as “politically motivated” and accused the US of “abusing its legal system to target Chinese citizens”. It vowed to “take all necessary measures to protect the lawful rights of Chinese nationals abroad”.
Analysts say the case could have wider implications for global business. “If the US is willing to jail a foreign businessman for transactions that took place entirely outside its borders and with no American victims, it sends a chilling signal to multinational corporations,” said Dr Eleanor Rigby, a senior fellow at Chatham House’s international law programme. “It also gives Beijing a powerful narrative about American hypocrisy, which it will use to justify its own controversial legal policies, such as the national security export controls.”
The trial revealed details of Cheng’s intricate operation, which allegedly used front companies in Hong Kong, Macau and Singapore to purchase goods from Chinese intermediaries and ship them to North Korean ports. The scheme reportedly earned him tens of millions of dollars between 2016 and 2019. Although North Korea is subject to broad UN sanctions, the US has often gone beyond the Security Council mandate in its unilateral enforcement measures.
London’s intervention is likely to be welcomed in European capitals. France and Germany have privately expressed reservations about US extraterritoriality, but have avoided public confrontation. Britain, now outside the EU, may be positioning itself as a bridge between American assertiveness and European legal principles. “Whitehall sees this as a chance to reaffirm its commitment to a rules-based international system while maintaining close ties with Washington,” Rigby noted.
The Business Secretary, Kwasi Kwarteng, is expected to raise the issue during a visit to Washington next week. His meetings will focus on reducing trade barriers, but sources say the Cheng case will feature prominently in discussions. “We cannot have a system where American law becomes the world’s law,” a senior official told the Financial Times on condition of anonymity.
For now, the geopolitical fallout is contained. But as the US gears up for midterm elections and China tightens its own legal tools, the risk of a cycle of retaliatory measures grows. The Foreign Office statement concluded with a call for “restraint and dialogue” – a plea that seems increasingly fragile.
