China has rights not to recognize the validity of Rio-BHPB merger as long as the alliance would constitute impacts to competitive order in domestic steel market in a restrictive and exclusive way, the Ministry of Commerce said in an initial statement on the proposed cooperative deal between the two international mining giants. Provided the potential new joint venture is set up in disregard of strong opposition from the Chinese side, it will likely be exposed to trade sanctions imposed by the government while concluding business with Chinese partners in the future.