When elephants fight, the grass is trampled. Today, Canada is the grass. It is caught in the US war on Huawei, one of China’s iconic businesses. Canada has done everything right. Nevertheless China has detained two Canadians, apparently in retaliation against the perfectly correct response of Canada’s judicial system to a US extradition request. This saga has big implications, for the US, for China, for foreigners who work in China and for the other law-governed democracies. The latter should take note of it and react.

This week, the US justice department accused Huawei of stealing American technology and breaking US sanctions against Iran. Some weeks earlier, Meng Wanzhou, chief financial officer of the company and daughter of its founder, had already been arrested in Canada on a US charge of violating its sanctions on Iran. According to Canada’s extradition treaty, this matter is, quite rightly, to be decided by the Canadian judicial process, without political interference. Extradition also does not depend on a finding of guilt. Canadian courts need only decide whether enough evidence exists to send Ms Meng for trial in the US.

For China, however, this action against such a prominent individual is both offensive and humiliating. After Ms Meng’s arrest, China duly threatened Canada with “serious consequences” and detained two Canadians, including a former diplomat, on vague charges of “harming national security”. These men appear to be hostages. China presumably wishes not only to punish Canada for its temerity, but to persuade it to release Ms Meng. Yet Canada’s government cannot just do what China wants. It has the rule of law — a concept communist China does not seem willing to understand.

This saga has significant ramifications. One is that the extraterritorial reach of US law — in this example, its prosecution of a Chinese company over alleged violation of US sanctions — has worrying implications for third countries. Another is that China is also willing to retaliate, again with troubling implications. As the conflict between the two superpowers heats up, other countries (and businesses and people) will surely be caught between them.

The US needs to consider carefully the consequences of its aggressively extraterritorial use of US law against countries and companies worldwide. This is not only going to poison relations with China itself, notably so in the case of its actions against Huawei. It also risks serious harm to innocent citizens of friendly countries that are caught in the middle. Indeed, even its own business people could be at risk.

China also needs to assess the damage it will suffer if foreigners conclude that they are potential hostages in its ongoing struggles with the US. Its retaliation could be highly damaging to its own interests, since it must undermine the willingness to do business in China of the very people it wants to attract.

Last but not least, other medium-sized and smaller countries need to speak up on the side of Canada. They, too, must want their business people to work safely in China. What has happened to the two Canadians could so easily happen to their own citizens. Canada, they should also recognise, is upholding core values of the rule of law, including judicial independence and treaty obligations to other countries.

It is this very probity that has exposed it to pressure, via China’s actions against Canadian citizens. The best way to reduce the likelihood of this happening elsewhere is for other countries to protest strongly on the Canadian side. They should be ready either to stand together, or prepare to fall separately.