Whereas the US has proven relatively discrete about its relationships with American tech firms, China is more than forthright about wanting to access companies’ data. The central government is currently weighing a draft law that would require both domestic and international tech firms with operations in China to provide a wealth of access to authorities. Among other items, the law would require companies to install backdoors in their products, provide encryption codes to the government, and store Chinese user data in servers on mainland China.
US companies in a range of industries already devote a great deal of resources playing defense against Chinese hackers. This new law, many say, would effectively open the floodgates of US firms trade secrets. Not only would this lead some American firms to consider pulling out of China, it also could discourage global demand for China’s own tech companies’ products.