The Data Sovereignty Vise: Two Governments, One Compliance Trap, No Safe Harbor, ComplexDiscovery

ComplexDiscovery cited two Morgan Lewis LawFlashes written by partner Todd Liao, senior associate Margaret Luo, managing associate Mudan He, and associates Sylvia Hu and Fan Shi in an article analyzing China’s new supply chain security regulations and its countermeasures targeting foreign extraterritorial laws.

Drawing on the authors’ LawFlash about China’s Regulations on Industrial and Supply Chain Security, the article notes that the framework expands regulatory scrutiny to include routine commercial conduct, such as terminating supply relationships, where such actions may be viewed as affecting supply chain stability.

Reflecting the authors’ LawFlash on China’s Regulations on Countering Foreign Improper Extraterritorial Jurisdiction, the article highlights that the evolving countersanctions regime creates overlapping exposure, where a single compliance decision may trigger multiple enforcement risks across Chinese legal mechanisms.