Decoupling China? How U.S. Chinese Relations are changing

Rising U.S.-EU tensions over China policy, escalating tariff disputes, evolving transatlantic sanctions regimes, and divergent export control approaches have fundamentally altered how multinational companies navigate the Atlantic trade corridor.

The strategic realignment between Washington and Beijing has created friction points with European allies, as Brussels seeks to balance economic interests with security concerns.

Well into 2025, businesses continue to grapple with increasingly complex and divergent U.S. and European regulatory frameworks that challenge traditional approaches to transatlantic commerce and force difficult choices about market access and compliance strategies.

In this episode of Nota Bene, Scott Maberry, international trade lawyer and partner at Sheppard Mullin, and Erika Trujillo, managing director of SEIA GmbH in Munich, Germany,

explore the European response to aggressive U.S. extraterritorial regulation, how rules in the EU and the United States are diverging, and how multinational companies can best manage the strategic realignment with regard to China.

Together they answer the following questions:

·      What are you seeing with U.S. and European sanctions export control rules? Is there a convergence or divergence?

·      Regarding China, with the strategic realignment between the United States and China, what is the response you are seeing in the EU?

·      If a significant divergence forces global multinationals to choose between the United States and China, how might that play out in practical terms?

·      How are these geopolitical changes changing the practical compliance choices global companies have to make in the real world?

·      For CFOs and chief legal officers leveraging external and internal compliance teams, what’s the big takeaway?

Key Takeaways

Their podcast discussion yields several important insights for trade compliance professionals and business leaders.

First, the both growing divergence between U.S. and European policies to export controls and sanctions, particularly regarding China-related restrictions, as well as the convergence in mechanisms.

Second, the episode emphasizes the importance of data-driven approaches to compliance management. Erika discusses how SEIA's advanced data analytics solutions help companies understand their risk exposure across different jurisdictions and regulatory frameworks. This technological approach becomes even more critical as companies face the complexity of managing compliance across divergent regulatory systems.

Third, the conversation underscores the strategic nature of modern trade compliance. Rather than being purely a regulatory function, trade compliance becomes a critical business capability that influences strategic decision-making about market entry, supply chain design, and business partnerships. Companies that can effectively manage these compliance challenges gain competitive advantages, while those that struggle face significant business risks.

The episode also explores how geopolitical changes are forcing companies to make difficult choices about their global operations. The potential for companies to be forced to choose between the U.S. and Chinese markets represents a fundamental shift in how global business operates, with profound implications for supply chain design, technology transfer, and business strategy.

For CFOs and chief legal officers, the key takeaway is the need to invest in sophisticated compliance capabilities that can provide real-time visibility into regulatory risks and support strategic decision-making. The traditional approach of reactive compliance management is no longer sufficient in an environment where regulatory changes can have immediate and significant business impacts.

Listen here the full podcast.

Click here to read the full transcript of the podcast.

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Discover how SEIA's advanced data analytics solutions can help your organization navigate complex regulatory landscapes and turn compliance into a competitive advantage. Visit www.seiatech.com to learn more about our PERCEIVE™ solution and schedule a consultation.