China’s Rare Defiance of US Sanctions Sparks Showdown Over Banks

China has ordered companies to defy US sanctions for the first time, a step that threatens to put its banking sector into the crosshairs of competition between the world’s largest economies.

The decision, announced on Saturday, risks becoming a watershed moment. While China has often railed against unilateral sanctions, it has in the past quietly allowed companies to comply with them to avoid blowback on its own economy and preserve access to the US financial system.

Beijing is now signaling a far firmer stance against such restrictions by directing companies not to abide by US sanctions on five domestic refiners ...