European companies are facing a growing challenge as the US and China continue to decouple. Many companies are worried about how to sit in the middle of these two superpowers and continue to do business in both markets.

There are several questions that companies need to consider, including:

• How can they comply with the increasingly complex and divergent regulations in China and the US?
• How can they protect their Chinese employees?
• How can they continue to do business in China without alienating the US government?
• What US-centric activities might cause negative impacts in China?

There is no easy answer to these questions, but there are a few things that European companies can do to mitigate the risks:

Develop a clear compliance strategy. Companies need to have a clear understanding of the regulations in both China and the US, and they need to develop a strategy for complying with both sets of regulations. This may involve making some changes to their business practices.

Be transparent with both governments. Companies should be transparent with both the Chinese and US governments about their operations in both markets. This will help to reduce the risk of misunderstandings and potential retaliation.

Diversify their supply chains. Companies should reduce their reliance on China by diversifying their supply chains to other countries. This will make them less vulnerable to disruptions in the Chinese market.

Invest in compliance training for their employees. Companies need to invest in compliance training for their employees, especially those who are working in China. This will help to ensure that their employees are aware of the risks and that they know how to comply with the relevant regulations.

It is important to note that there is no one-size-fits-all solution for European companies. The best approach will vary depending on the specific company and its industry. However, by following the tips above, companies can mitigate the risks and continue to do business in both China and the US.

In addition to the above, European companies should also consider the following:

• Strengthen their relationships with their European partners. This will help them to create a stronger and more resilient European economy.
• Increase their investment in research and development. This will help them to develop new technologies and products that are not dependent on China or the US.
• Advocate for a more open and multilateral trading system. This will help to reduce the risk of trade wars and other economic disruptions.

Sitting in the middle of China and the US is a challenging task, but it is one that European companies must master if they want to remain competitive in the global economy. By taking the necessary steps, European companies can mitigate the risks and continue to do business in both markets.