I am playing Red Dragon Rising (standard rules) and on GT8 I make a contested sea roll in the Ryukyu in the Allies favor which forces a PRC SAG to retreat to the Taiwan Straits sea box. As per SSR 7.4.3 I do not adjust the submarine level for this retreat until the reinforcement and replacement phase. Is this the way the rule was intended to be written? There is no mechanism with the counter set to keep track of this during the turn (obviously I could write it down). It seems a retreat would give an immediate benefit (e.g. starting in the next movement phase).
That's a good point. Adjust it immediately.