As administrations around the world began lining up against Beijing over its unilaterally-declared Air Defence Identification Zone (ADIZ), dismissing it as invalid, Japan called on its airlines to refuse China's demands that they obey new rules when entering the zone.
China's declaration of an air defence zone has sharply escalated tensions in the region.
The rules Beijing announced at the weekend mean China has effectively demanded control over the airspace above a swathe of the East China Sea criss-crossed by vital transport lanes.
Its affiliate Peach Aviation said it was doing the same "for now" and Japan Airlines said it was also complying with the rules.
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But today the Kyodo and Jiji news agencies reported that both All Nippon Airways and Japan Airlines had reversed that decision. They gave no further details on the climbdown.
The zone covers the Tokyo-controlled Senkaku islands, which Beijing claims as the Diaoyus, where ships and aircraft from the two countries already shadow each other in a dangerous game of cat and mouse.
"Australia has made clear its opposition to any coercive or unilateral actions to change the status quo in the East China Sea," said Foreign Minister Julie Bishop.
In response, China's foreign ministry said that "we hope Australia can understand correctly, and make joint efforts to maintain the security of flight in the relevant airspace".
Germany's government said the move "raised the risk of an armed incident between China and Japan".
"This announcement from the Chinese government was unnecessarily inflammatory," White House deputy spokesman Josh Earnest told reporters aboard Air Force One.