Beware the long arms of American and Chinese law

A small town in Germany gets a letter from US senators, threatening it with “crushing, legal and economic sanctions”. Professors at Oxford and Princeton tell students to submit essays anonymously — to protect themselves from potential arrest for violating Chinese law.

Welcome to the world of extraterritoriality. The US and China are increasingly seeking to extend the reach of their domestic law overseas — compelling foreign companies and people to do the bidding of Washington or Beijing. The rise of extraterritoriality is the latest sign of the sad decline of our old friend, the rules-based international order, under which big powers at least pretended to play by the same rules as everybody else.

In the extraterritorial world, there is one set of rules for superpowers and another for everybody else. This looks less like the 21st century, as imagined by international lawyers and more like the 19th century, in which imperial powers imposed their will on others.

It is the US that has gone furthest in the use of extraterritorial law. Its most important weapon is one available to no other nation — the dollar’s status as the global reserve currency. That means foreigners often use the American financial system and so become vulnerable to prosecution under US law. It also…

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