China limits IT security imports

Chinese authorities have requested that banks and other large companies in the country limit their use of imported information security technology, according to the Associated Press news agency.

Under new rules known as the Multi-Level Protection Scheme, companies in China are encouraged to use Chinese IT security suppliers. Some companies have reportedly had their premises inspected and have been asked to replace security systems with China-built technology.

The measure is obstensibly intended to address national security concerns.The Multi-Level Protection Scheme also urges foreign security technology companies to disclose encryption technologies, echoing calls from India and various Gulf states in recent weeks for Canadian BlackBerry-maker RIM to make it easier for authorities to intercept messages sent using the device.

But US observers argue that it also serves as a protectionist measure to boost the domestic IT industry.

Earlier this year, a group of US IT industry executives including Microsoft CEO Steve Ballmer wrote to President Barack Obama asking him to oppose a separate Chinese scheme to promote "indigenous innovation". At the time, a US Chamber of Commerce official said that the scheme was designed to "provide distinct advantages to domestic companies and products and to force technology transfer if foreign players choose to participate”.

According to China’s Ministry of Industry and Information Technology, the country’s IT software industry grew 29% to $89.3 billion in the first six months of this year.

Pete Swabey

Pete Swabey

Pete was Editor of Information Age and head of technology research for Vitesse Media plc from 2005 to 2013, before moving on to be Senior Editor and then Editorial Director at The Economist Intelligence...

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