In May, China’s Ministry of Commerce took an unprecedented step: it ordered Chinese firms to disregard U.S. sanctions against five domestic refiners processing Iranian crude oil. Weeks later, China’s Ministry of Justice issued another first-of-its-kind order, declaring that the European Union’s antisubsidy probe into a Chinese security firm was an improper assertion of foreign jurisdiction.

These measures might seem like ordinary bureaucratic retaliation, the latest moves in a familiar cycle of sanctions, investigations, and countermeasures. But they are part of an important shift in the terms of global rivalry. Traditionally, assessments of a country’s ability to shape events beyond its borders have focused on its military strength, economic size, and cultural reach. Today, an understanding of national power must also include what countries can obtain through the law. Beijing’s recent moves to resist extraterritoriality flow directly from a strategic, state-led project to improve China’s legal power.

The United States led the construction of the postwar legal order, and for decades, it has had a disproportionate ability to shape global outcomes through legal instruments. In the early 2010s, for example, Washington leveraged various jurisdictional advantages to cut Iran off from oil markets and global banking, pressuring it into negotiations. The United States’ legal power has rested in part on wealth and military strength, but it has also depended on the capacity of American legal personnel, the credibility of U.S. legal institutions, and the jurisdictional control the United States has retained over key nodes of the global economy.

These advantages have not gone unnoticed in China. Over the past decade, Beijing has mobilized ministries, courts, law schools, and bar associations around a shared goal: enabling China to use the law more effectively beyond its borders. Beijing has invested in building a cadre of lawyers who understand foreign and international law. It has advised Chinese entities on how to defend themselves more effectively in foreign courts and international tribunals. It has promoted Chinese courts and arbitration bodies as alternatives to Western forums. It has expanded its use of sophisticated legal tools—including sanctions, blocking rules, export controls, and national security reviews—to police foreign actors’ conduct. And it has sought greater influence over global norms, from technical standards to rules governing sea-lanes.

China’s bid for legal power has enjoyed real success. Past a certain point, however, China will struggle. It is relatively easy to enact new laws and train better lawyers; it is harder to reproduce the institutional credibility and economic indispensability that made the United States a dominant legal force. But the United States cannot simply assume that its inherited advantages will endure. It must work to preserve the legal institutions, professional expertise, economic relationships, and international commitments from which U.S. legal power has long derived. If, instead, Washington dismantles the legal structures underpinning its power—as it has begun to in recent years—Beijing may be well positioned to step into the void.

Washington’s extraordinary legal power traces back to the central role the United States played in designing the post–World War II international order. Even before the war, the country had already developed a large legal profession, sophisticated corporate firms, and distinctive constitutional institutions, although European legal systems retained greater intellectual prestige. The United States’ wartime ascent allowed it to marshal those domestic capacities into building U.S.-centric international rules and institutions. Washington helped shape the UN Charter, the General Agreement on Tariffs and Trade, and the Bretton Woods system, embedding U.S. influence into institutions governing international security, trade, and finance.

The United States continued to accumulate legal power over the second half of the twentieth century. Its law schools, law firms, and government agencies helped develop a pipeline of talented lawyers expert in national security law,........

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