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 China's proposals, which would require tech firms to provide
encryption keys and install backdoors granting law enforcement
access for counterterrorism investigations, drew criticism from
Obama, who told Reuters in an interview this week China would have
to change the draft law if it were "to do business with the United
States".
Fu Ying, China's parliamentary spokeswoman, said many Western
governments, including Washington, had made similar requests for
encryption keys while Chinese companies operating in the United
States have long been subject to intense security checks.
China's proposals were "in accordance with the principles of China's
administrative law as well as international common practices, and
won't affect Internet firms' reasonable interests", Fu said.
Fu made the remarks during a news conference carried live on state
television a day before the start of the National People's Congress,
the largely rubber-stamp parliamentary session held every spring in
Beijing.
China's increasingly restrictive cybersecurity policies enacted in
the wake of Edward Snowden's disclosures of U.S. spying programs
have become a source of considerable friction in bilateral
relations. Also at issue has been a set of financial sector
regulations that pushes China's state-owned banks to buy technology
from domestic vendors.
Foreign business lobbies say the rules are unfairly sweeping names
like Cisco <CSCO.O> and Microsoft <MSFT.O> out of the world's
second-largest economy, while Chinese officials point to the
treatment of Huawei <HWT.UL> and ZTE Corp <000063.SZ>, two Chinese
telecoms equipment makers that have been effectively locked out of
the U.S. market on cybersecurity grounds.
The German ambassador to China, Michael Clauss, also expressed
concern that the cybersecurity policy "could make market access for
foreign companies in China much more difficult".
Fu said China hoped foreign companies would continue to "support,
participate and continue to walk forward" with China's reform
efforts.
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The remarks were more measured than a commentary published by the
official Xinhua news agency, which said Obama's warning to China was
evidence of "arrogance and hypocrisy".
"With transparent procedures, China's anti-terrorism campaign will
be different from what the United States has done: letting the
surveillance authorities run amok and turn counterterrorism into
paranoid espionage and peeping on its civilians and allies," Xinhua
said.
U.S. business lobbies have said the proposed regulation would render
secure communications unfeasible in China and handing over such
commercially sensitive information would seriously harm their
credibility. The head of the American Chamber of Commerce in
Shanghai, Kenneth Jarrett, called for more discussions with the
Chinese government.
Fu, the parliamentary spokeswoman, said China would continue to
amend the counterterrorism law but would not compromise its national
security priorities.
"We will definitely continue to listen to extensive concerns and all
parties' views, so we can make the law's formulation more rigorous,"
she said. "On the other hand, fundamentally speaking, (the law) will
reflect our country's counter-terrorism interests."
(Additional reporting by Beijing newsroom and Sue-Lin Wong in
SHANGHAI; Editing by Nick Macfie)
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