United States business groups are calling upon China to postpone the implementation of new regulations that some are saying could be a “backdoor” for espionage and hacking by the Chinese government, according to an industry trade letter attained by the BBC.
The new rules, according to the group that included the U.S. Chamber of Commerce, would force tech companies selling computer equipment to Chinese banks to set up research and development facilities in the country, require all workers servicing technology equipment to get work permit, and the establishment of “ports” where Chinese officials can manage and monitor data processed by the hardware shipped into the country. There is also a provision where the source codes for the technology, which are a set of fiercely guarded commands that create programs within the software, must be turned over to government officials and regulators, a stipulation that has business groups concerned about possible privacy violations and espionage against American companies.
“The domestic purchasing and related requirements proposed recently for China’s banking sector… would unnecessarily restrict the ability of Chinese entities to source the most reliable and secure technologies, which are developed in the global supply chain,” read the letter, which was dated Jan 28 and obtained by the BBC. The letter called on Beijing to delay the implementation of the regulations so that there could be open “discussion and dialogue” among both parties to find a possible compromise.
The regulations themselves, which were written late last year according to The New York Times, were in response to reports that America’s National Security Agency had embedded software in exported technology to aid in spying efforts in China, as well as both Washington’s harassment of Chinese telecommunications company Huawei for hacking into the computers of military contractors, as well as American companies like Cisco and Microsoft being made to accept stricter security standards in China before being able to access the lucrative state-run financial institutions, which are beginning to expand in the online and mobile banking fields in a big way.