It's written in their "anti-espionage law", where all companies based in China have the duty to actively comply with spying requests when asked.

Sounds like Australia, except it extends to all citizens so it’s worse.

As a matter of government policy, all Chinese companies are government operatives. The Communist Party claims "overall leadership over all areas of endeavour in every part of the country".

Not sure why you're getting downvoted. It's legally and practically true.

So it's like a National Security Letter on steroids?

Or just a national security letter, not even on steroids.

No. The CCP has literal ownership in Chinese firms in the form of equity.

isn't all companies subject to the laws of their respective host countries? The narrative of "party rules all" is way too simplistic to form an argument. At least I would be curious to look for past events of how the party exerted influence on non-state-owned-enterprises.

Laws, yes. Will, no. The Chinese Government regularly leverages influence on it's largest companies to great effect. Apple is subject to the laws of the United States (allegedly) but the US Government hardly has a say in what they do within the scope of those laws.

And laws are the will of the government ratified by justice (sometimes meaninglessly). How did will of the people held up against the canning of net neutrality? What say did the people have in the sanction and re-sanction of Iran?

The OP claims government policy dictates everything. Has anyone passed a thought what "policy" actually mean? Is it law or under the table practice? Not you nor the OP said anything substantial other than "they do it". No shit. FBI is also working their hardest to gain access privilege through everyway they can in the scope of their capacity. The real question to ask is not whether the Chinese government will influence Chinese companies, but HOW and whether companies like Huawei can resist or has resisted in the past.