Date
17 January 2017
China has released new regulations on internet news and information that covers all players including foreign companies. However, it's not clear what constitutes such services. Photo: Reuters
China has released new regulations on internet news and information that covers all players including foreign companies. However, it's not clear what constitutes such services. Photo: Reuters

China’s Great Firewall just got harder to climb

Beijing has expanded its internet footprint with the release of new regulations on online news and information.

This dovetails with President Xi Jinping’s efforts to make all state media serve the Communist Party.

Xi made this clear during a recent visit to media outlets in Beijing.

Under the new rules, all foreign solely owned companies and joint ventures with domestic partners must obtain a license to provide internet news and information services.

All technical equipment, servers and storage facilities must be based in China and subject to inspection anytime.

Licenses are renewable every five years.

The conditions are stringent.

All internet news providers must guarantee that their content will not threaten national unity and honor or disrupt social harmony among different ethnic groups.

But it’s not clear what constitutes “internet news service”.

Chinese authorities merely define it as anything engaged in “collecting, publishing and reposting information to the public”.

Under that definition, all news and information websites run by the foreign media are subject to the new rules.

The question is whether official websites of non-media foreign entities such as banks, retailers and IT companies fall under that definition.

If so, these companies might need to make some concessions to ensure their websites continue to operate in China.

Certainly, individuals and companies can set up websites offshore such as in Hong Kong or the United States for a mainland audience to circumvent the new guidelines.

But Chinese authorities are farther along that road.

They have blocked several virtual private networks, making it that much harder to crack the Great Firewall, China’s supposedly impregnable internet fortress.

The new regulations don’t take effect until March 10 but that is little consolation to many foreign publishers and producers who are having a hard time assessing their potential impact.

This is yet another sign Beijing is trying to impose total control over the internet, making life more difficult for foreign companies in China.

One of them is Apple Inc., which recently launched Apple Pay to compete with Alipay and WeChat Pay.

Apple is mired in a legal battle with the US government over unlocking an iPhone used by one of the San Bernardino attackers.

If it loses, will Apple allow Chinese authorities to inspect their technical equipment and servers?

Shielded from foreign rivals, domestic players such as Baidu, Alibaba and Tencent will continue to dominate the Chinese market.

But lack of competition will ultimately harm China’s economic and social growth.

This article appeared in the Hong Kong Economic Journal on Feb. 23.

Translation by Julie Zhu

[Chinese version 中文版]

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JZ/DY/RA

Hong Kong Economic Journal columnist

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