China's newly ratified Cybersecurity Laws rattled foreign tech firms operating in China requiring tech companies to hand over source codes and build backdoors in both hardware and software for Chinese regulators.
Under the new law, China would require software and hardware companies to disclose their source codes are secure and cannot be compromised by hackers. The new regulations are enforced citing espionage concerns divulged by Edward Snowden.
Tech companies have always regarded their proprietary source codes as "crown jewels" of their business enterprises, for this reason, tech companies operating in China, particularly, Microsoft, Intel, and IBM, are opposed to offering up their source codes fearing that these could potentially fall into the wrong hands.
The new law, adopted on Nov. 7 and expected to be enforced next June, had U.S. company's start lobbying against its imposition. According to Fortune, though the law is set to discourage non-Chinese and Chinese hackers, it also requires foreign tech firms to provide the Chinese government with sensitive information regarding their software and network equipment.
Citing China's lack of enforcing intellectual property laws, it is but natural for the foreign tech firms to be loath in just handing over trade secrets that can potentially fall into the hands of Chinese competitors to the detriment of their companies.
Microsoft for its part says that sharing source codes in itself do not prove systems can be secure and controllable, the add that it only proves there is a source code. Intel said that disclosing details of their products would impair technological innovation and compromise the security level of products. IBM said distinctions between computing services and commercial use should be made as opposed to services for government applications, The Wall Street Journal reported.
Beijing for its part says the law is crafted to apply to both domestic and foreign companies, stressing that allegations citing the law would favor domestic firms is clearly biased and misunderstood, the statement underlying the fact that certain Chinese officials wanted the standards to favor domestic companies.
The biggest concern of tech companies regarding the imposition of the new law is the vagueness of it. It literally opens up various interpretations that could cover a broad footprint on what can be forced upon tech companies to disclose of their IPs, and have these technologies tagged "secure and controllable" in the Chinese market.
