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Protectionist policies

New tech laws may rid China of American technology

Natali Vlatko
Flag image via Shutterstock

A new law recently passed in China will require foreign tech companies servicing banks in the country to release their source code and give back-door access in order to continue doing business. Foreign business groups are objecting to the new policies.

New regulations introduced in China late last year will require that all companies servicing banks in the country reveal their source code, submit to audits and create back doors in hardware and software. The legislation affecting all foreign companies doing business in China is viewed by concerned parties as a move for protection of local Chinese technology.

Unprecedented access

Companies that sell their wares to Chinese financial bodies will have to give the government unprecedented access to their products, something which could be bad news for firms such as Apple, who are reportedly selling more iPhones in China than in the U.S.

China’s security fears have been putting pressure on foreign companies to compromise their intellectual property, with these new laws intended to strengthen cybersecurity in critical Chinese industries. Chinese companies will also be required to adhere to the new rules, however will find it easier given their primary consumers are located in China.

Paul Mozur, reporting for The New York Times, has stated that the new laws go far beyond the precautions taken by other countries in the realm of cybersecurity:

Although it is unclear to what extent the new rules result from security concerns, and to what extent they are cover for building up the Chinese tech industry, the Chinese regulations go far beyond measures taken by most other countries, lending some credibility to industry claims that they are protectionist.

It’s also worth noting that this move is another part of the ongoing to and fro between China and America over online security and tech policy – the U.S. have made it virtually impossible for Chinese company Huawei to sell any of its merchandise on American soil, citing concerns that their products could contain back doors for the Chinese government.

This news comes shortly after the announcement of U.K. Prime Minister David Cameron’s proposed new anti-terror laws, which aim to infiltrate end-to-end encryption when targeting terrorist activities.

Author
Natali Vlatko
An Australian who calls Berlin home, via a two year love affair with Singapore. Natali was an Editorial Assistant for JAXenter.com (S&S Media Group).

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