China upset as U.S. sanctions firm tied to North Korea nuclear program

[September 27, 2016]  BEIJING (Reuters) - China said on Tuesday it was opposed to any country using its own laws to carry out "long arm jurisdiction", after the United States sanctioned a Chinese industrial machinery wholesaler tied to North Korea's nuclear program.

The U.S. Treasury said it was sanctioning Dandong Hongxiang Industrial Development Co and four of its executives, including the firm's founder, Ma Xiaohong, under U.S. regulations targeting proliferators of weapons of mass destruction.

It accused the firm of acting on behalf of North Korea's Korea Kwangson Banking Corp (KKBC), which has been under U.S. and U.N. sanctions for supporting proliferation of such weapons.

The U.S. Department of Justice said it had filed criminal charges against the Chinese firm and the executives for using front companies to evade sanctions on North Korea's nuclear weapons and ballistic missile programs.

Asked about the move, Chinese Foreign Ministry spokesman Geng Shuang said China was committed to upholding United Nations resolutions against North Korea, which mandate tough sanctions for its nuclear and missile tests.

Any person or company found in breach of the rules will be punished, and if necessary China will cooperate with other countries on this on the basis of mutual respect and equality, Geng told a daily news briefing.

"I want to stress that we oppose any country enacting so-called long arm jurisdiction, using its own domestic laws against a Chinese entity or individual," he added.

"We have already communicated this position to the U.S. side," Geng said, without elaborating.

While China is North Korea's sole major ally, it disapproves of its nuclear and missile programs and was angered by its latest nuclear test.

A North Korean flag flies on a mast at the Permanent Mission of North Korea in Geneva October 2, 2014. REUTERS/Denis Balibouse/File Photo

Beijing has said it will work within the United Nations to formulate a necessary response, but questions remain as to whether it is willing to agree tough enough steps to force North Korea to abandon nuclear weapons.

On Monday, U.S. Republican Presidential candidate Donald Trump said China should "go into North Korea" to stop its nuclear plans as China has all the power in the relationship.

Chinese spokesman Geng said the crux of the North Korea issue was not China, and that China has made great efforts to try and bring about the denuclearization of the Korean peninsula.

Discussions are under way on a possible new U.N. sanctions resolution and the senior U.S. diplomat for Asia said on Friday he was confident an agreement would be reached before long, imposing further sanctions and tightening existing ones.

(Reporting by Ben Blanchard; Editing by Simon Cameron-Moore)

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