The Ultimate Aim Of China's 2016 Cybersecurity Law Is Now Clear: Nothing Digital Can Be Secret From The Authorities

from the looking-at-you,-too,-foreign-companies dept

It's no secret that China is tightening its control of every aspect of the online world -- Techdirt has been reporting on the saga for years. But what may not be so clear is how China is doing this. It is not, as many might think, the direct result of diktats from on high, but flows naturally from a massive program of carefully-crafted laws and new government initiatives created with the specific intent of making the online world subservient to the Chinese authorities. Central to this approach is a law passed three years ago, generally known in the West as "China's cybersecurity law".

A review of the law in 2017, by the New America think tank, brought some useful clarity to complicated political landscape. It names a number of powerful players involved, including the Cyberspace Administration of China, the Ministry of Public Security, the Ministry of Industry and Information Technology, the country's military and intelligence establishment, and BAT -- Baidu, Alibaba, Tencent -- China's Internet giants. The legal framework is also complex. The 2017 article picks out six "systems": the Internet Information Content Management System; the Cybersecurity Multi-Level Protection System; the Critical Information Infrastructure (CII) Security Protection System; the Personal Information and Important Data Protection System; the Network Products and Services Management System; and the Cybersecurity Incident Management System.

Clearly, there's a huge amount of activity in this area. But because of the many interlocking and interacting elements contributing to the overall complexity, it's hard to discern what's key, and what it will all mean in practice. A 2018 report on the law from the Center for Strategic & International Studies noted that one of the systems -- the Multi-Level Protection System (MLPS) -- has a far wider reach than its rather bland name implies:

MLPS ranks from 1-5 the ICT networks and systems that make up China's CII based on national security, with Level 5 deemed the most sensitive. Level 3 or above triggered a suite of regulatory requirements for ICT products and services sold into that CII, including indigenous Chinese IP in products, product submission to government testing labs for certification, and compliance with encryption rules banning foreign encryption technology.

That in itself is not surprising. Governments generally want to know that a country's digital infrastructure can be trusted. However, it turns out these rules will apply to any company doing business in China:

MLPS 2.0 will cover any industry with ICT infrastructure because it covers the vague category called "network operators," which can include anyone who uses an ICT system. MLPS 2.0 also appears to have a focus on cloud computing, mobile internet, and big data.

That extremely broad reach has been confirmed following the recent appointment of a big data expert to oversee the implementation of MLPS. The China Law Blog has analyzed several Chinese-language articles giving details of this move, and what emerges will be deeply troubling for any foreign business operating in China:

This system will apply to foreign owned companies in China on the same basis as to all Chinese persons, entities or individuals. No information contained on any server located within China will be exempted from this full coverage program. No communication from or to China will be exempted. There will be no secrets. No VPNs. No private or encrypted messages. No anonymous online accounts. No trade secrets. No confidential data. Any and all data will be available and open to the Chinese government.

As the China Law Blog explains, this means that there will be important knock-on consequences:

Under the new Chinese system, trade secrets are not permitted. This means that U.S. and EU companies operating in China will now need to assume any "secret" they seek to maintain on a server or network in China will automatically become available to the Chinese government and then to all of their Chinese government controlled competitors in China, including the Chinese military. This includes phone calls, emails, WeChat messages and any other form of electronic communication.

As previous Techdirt posts have reported, China has been steadily moving in this direction for years. Nonetheless, seeing the endgame of the authorities -- unchecked access to everything flowing through Chinese networks -- confirmed is still troubling. The intentions are now clear, but a key unanswered question is how rigorously the strategy will be enforced. The situation for social media censorship in China gives some grounds for hope. An article on the Asia Dialogue site explains:

Despite the broad and still expanding legal framework, the actual implementation of China’s information control is neither monolithic nor consistent. While the Chinese government is increasingly adept at managing and using new media and advanced technologies to its advantage, it also relies heavily on private companies to carry out government directives on a daily basis.

The same may be true for the implementation of MLPS 2.0 in particular, and China's cybersecurity law in general. If it isn't, Western companies are likely to find operating in the country even more difficult than it is now, when it is hardly plain sailing.

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Filed Under: china, cybersecurity, cyberspace administration, encryption, ministry of public security, privacy, secrecy, surveillance