What is MOFCOM and what does it do?: MOFCOM is China's Ministry of Commerce, responsible for trade policy, foreign investment rules, and implementing counter-sanctions measures under China's Anti-Foreign Sanctions Law of 2021.
How did China respond to US sanctions on Hengli Petrochemical?: MOFCOM issued a formal diplomatic protest through the US embassy in Beijing in April 2026, condemning the Hengli sanctions as illegal under international law but stopping short of activating retaliatory measures under the Anti-Foreign Sanctions Law.Source: event
What powers does China's Anti-Foreign Sanctions Law give MOFCOM?: The 2021 AFSL allows MOFCOM to place foreign individuals and entities on a countermeasures list, imposing asset freezes, travel bans, and restrictions on doing business in China.
What is China's MOFCOM and why does it matter for Iran sanctions?: MOFCOM is China's trade ministry. It issued a Blocking Rules order forbidding Chinese firms from complying with OFAC's Hengli sanctions, but China's banking regulator simultaneously told state banks to halt new loans to the same firm.Source: Bloomberg
Why is China's position on Iran oil sanctions contradictory?: MOFCOM publicly orders firms to defy OFAC designations while the NFRA privately tells state banks to stop lending to the same firms, revealing a split between diplomatic signalling and actual financial enforcement.Source: Bloomberg
What is China's 2021 Blocking Rules law?: The Blocking Rules allow MOFCOM to prohibit Chinese firms from complying with foreign unilateral sanctions and to counterclaim in Chinese courts for losses suffered. Announcement No. 21 was its first major activation.

Background

MOFCOM (Ministry of Commerce of the People's Republic of China) is the cabinet ministry responsible for trade policy, foreign investment regulation, and international commerce. Founded in 1949, it oversees export licensing, anti-dumping investigations, and trade remedy proceedings. Its dual role as both a trade facilitation ministry and an economic statecraft instrument has become increasingly prominent since 2018, when the US-China trade war began. Under China's Anti-Foreign Sanctions Law (AFSL) of 2021, MOFCOM maintains a countermeasures list of foreign individuals and entities subject to Chinese retaliatory measures including asset freezes, visa bans, and restrictions on doing business in China.

Bloomberg confirmed on 7 May 2026 that MOFCOM and China's NFRA (National Financial Regulatory Administration) were operating contradictory mandates simultaneously toward the same set of Iranian-crude-linked refineries. The NFRA had privately ordered the four largest state banks, ICBC, Agricultural Bank of China, CCB, and Bank of China, to halt new yuan loans to Hengli Petrochemical and four other OFAC-designated refineries. MOFCOM's Announcement No. 21, issued under the 2021 Blocking Rules, publicly ordered those same firms to defy the OFAC designation .

The NFRA-MOFCOM split is the clearest evidence to date that Beijing's enforcement posture on Iranian oil sanctions is bifurcated: MOFCOM signals defiance for diplomatic and domestic consumption while the banking regulator quietly enforces dollar-clearing risk. The contradiction sits three days ahead of the Trump-Xi summit, creating pressure on Beijing to resolve which ministry's signal represents actual policy . MOFCOM had previously issued a formal protest via the US embassy channel after the initial Hengli designation, a calibrated signal that China objects without wanting to escalate.

Source Material

Ministry of Commerce (China) — Wikipedia Ministry of Commerce of the People's Republic of China Ministry of Commerce of the People's Republic of China

How the World Sees Them

Sees MOFCOM's measured response as evidence China is not prepared to fully deploy AFSL countermeasures while the Iran conflict risk is highest; views formal protest as face-saving not escalation.

Iran

Disappointed that China has not moved beyond a diplomatic protest; had hoped MOFCOM AFSL activation would deter further sanctions targeting Chinese Iran-crude buyers.

China / MOFCOM

Argues Hengli sanctions violate WTO non-discrimination principles and China's sovereign right to engage in lawful trade; restrained response reflects strategic patience rather than acceptance.