New ‘cybersecurity’ rules in China smack of protectionism, says U.S. Chamber of Commerce

“The Chinese government has adopted new regulations requiring companies that sell computer equipment to Chinese banks to turn over secret source code, submit to invasive audits and build so-called back doors into hardware and software, according to a copy of the rules obtained by foreign technology companies that do billions of dollars’ worth of business in China,” Paul Mozur reports for The New York Times.

“The new rules, laid out in a 22-page document approved at the end of last year, are the first in a series of policies expected to be unveiled in the coming months that Beijing says are intended to strengthen cybersecurity in critical Chinese industries,” Mozur reports. “As copies have spread in the past month, the regulations have heightened concern among foreign companies that the authorities are trying to force them out of one of the largest and fastest-growing markets.”

“In a letter sent Wednesday to a top-level Communist Party committee on cybersecurity, led by President Xi Jinping, foreign business groups objected to the new policies and complained that they amounted to protectionism,” Mozur reports. “The groups, which include the U.S. Chamber of Commerce, called for ‘urgent discussion and dialogue’ about what they said was a ‘growing trend’ toward policies that cite cybersecurity in requiring companies to use only technology products and services that are developed and controlled by Chinese companies.”

“While the Obama administration will almost certainly complain that the new rules are protectionist in nature, the Chinese will be able to make a case that they differ only in degree from Washington’s own requirements,” Mozur reports. “The United States has made it virtually impossible for Huawei, a major Chinese maker of computer servers and cellphones, to sell its products in the United States, arguing that its equipment could have ‘back doors’ for the Chinese government.”

Some of America’s largest tech companies could be hurt by the rules, including Apple, which is making a big push into the country. Apple has used new encryption methods in the iPhone 6 that are based on a complicated mathematical algorithm tied to a code unique to each phone. Apple says it has no access to the codes, but under the proposed antiterrorism law, it would be required to provide a key so that the Chinese government could decrypt data stored on iPhones.

Read more in the full article here.

MacDailyNews Take: How long can Cook et al. hold out on iOS encryption and with what will the powers that be, in the U.S. and elsewhere, threaten Apple in order to get what they want?

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Apple agrees to subject products to Chinese government security inspections – January 22, 2015

Apple takes top luxury gifting spot in China – January 29, 2015
Apple iPhone No. 1 in China smartphone market share – January 27, 2015
UK prime minister Cameron demands backdoors into messaging apps or he’ll ban them – January 13, 2015
Short-timer U.S. Attorney General Eric Holder blasts Apple for protecting users’ privacy against government overreach – September 30, 2014
Signaling post-Snowden era, Apple’s iPhone, iPad lock out N.S.A. – September 27, 2014
FBI blasts Apple for protective users’ privacy by locking government, police out of iPhones and iPads – September 25, 2014
U.S. House Intelligence Committee’s attack on China’s Huawei, ZTE could trigger major crisis – October 10, 2012


  1. Mozur reports. “The United States has made it virtually impossible for Huawei, a major Chinese maker of computer servers and cellphones, to sell its products in the United States, arguing that its equipment could have ‘back doors’ for the Chinese government.”
    Well, everybody suspected they were doing this, but now they have confirmed it aka made it official. So, if you buy a Chinese made phone, you know for certain that it can be hacked by the Chinese gov.

    1. The moral we SHOULD be getting from this is that China is a least partially right about one thing – the U.S. government has proven that it cannot be trusted to follow even its own laws. It abuses powers, violates the Constitution, and forces companies to go along with it while forbidding them from telling anyone.
      Does anyone here honestly think that it is _impossible_ that the U.S. government has forced Apple (and other companies) to provide a backdoor and then ordered them to lie about it? I hope it hasn’t happened, but I wouldn’t put it past this government, no matter which political party happens to be in power.
      The reality is that the U.S. government has no credibility in saying that governments shouldn’t force companies this way, because it regularly subverts ACTUAL security of users for its ability to control and spy on users.
      This is a big mess.

  2. and who, exactly, couldn’t see this one coming ?

    maybe mr. cook and associates, who have been blinded by what they saw as the golden opportunities for immense profits in the chinese markets ?

    the chinese are ruthless and exceptionally highly skilled at playing the long game. once they suck you in and make you increasingly dependent upon sales in their country as a large part of your profitability, they have you by the short hairs.

    they can close you right out of their markets unless you kow tow to their demands.

    meanwhile they have most of your manufacturing capability, and insights into your fabrication and design of your most important products.

    and once they start pulling these stunts, don’t for a minute imagine that the u.s. govt will come to your aid… unless you give them the backdoor capability to your products, and even then don’t expect much help. china holds a huge proportion of our foreign debt, they could seriously damage our economy if they chose to and that is the last thing our govt. wants or needs.

    they have apple right where they want them – in a corner.

  3. Maybe this is what Apple’s cash horde is really for. If they have to withdraw from China because the Chinese government’s demands are too onerous they will need time and money to recover and rebuild.

    I believe that Apple will never acquiesce to demands for back doors to securely encrypted customer data. It’s not who they are. The price could be steep. But they will survive and endure.

    Apple has the ability, almost uniquely among foreign companies, to shape China’s policies. Chinese manufacturer’s profitability depends very heavily on Apple’s continued success and investment in the country. If Apple start to look elsewhere many Chinese business leaders are likely to influence policy making in order to keep Apple in China.

  4. In other words, Apple needs to make cybersecurity safer by making it less safe by creating back doors? And what happens when the backdoor information somehow “leaks” outside the hands of the Chinese government into the hands of who knows what entity?

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