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China Says New Anti-Terrorism Law Won't Hurt U.S. Tech Companies

The draft legislation has caused concern in Western capitals as it could require technology firms to install "back doors" in products.

Technology companies have nothing to fear from China's new anti-terrorism law that aims to prevent and probe terror activities, China's Foreign Ministry said on Wednesday, rebuffing U.S. criticism as unwarranted.

The draft anti-terrorism law has caused concern in Western capitals as it could require technology firms to install "back doors" in products or to hand over sensitive information such as encryption keys to the government.

The law is currently having another reading at the latest session of the standing committee for China's largely rubber-stamp parliament, the National People's Congress, which ends on Sunday.

This week, the U.S. State Department said it had expressed "serious concerns" to China about the law. Chinese Foreign Ministry spokesman Hong Lei said he was "dissatisfied" with the U.S. position and hoped they respected China's law-making process and did not adopt "double standards." China faced a serious threat from terrorism and needed to improve its legal framework to deal with the problem, Hong added. "What we are doing is reasonable and fair," he said.

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Terrorists had been using the Internet to operate and China needed laws to cope with this, Hong added. "While formulating this law, we referred to the laws of other countries, including the United States," he said, pointing to the U.S. Communications Assistance for Law Enforcement Act, a wiretapping law.

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"The draft of our anti-terrorism law mandates the obligation of telecommunications operators, Internet servers and service providers to assist public and state security organ in stopping and probing terrorist activities," Hong added. "This is both totally rational and necessary. This rule won't limit the lawful operations of companies, does not provide a 'back door' and will affect neither the firms' intellectual property nor Internet users' freedom of speech."

Officials in Washington have argued the law, combined with new draft banking and insurance rules and a slew of anti-trust investigations, amounts to unfair regulatory pressure targeting foreign companies. China's national security law adopted in July requires all key network infrastructure and information systems to be "secure and controllable." The U.S. has also said the new law could restrict freedom of expression and association.