Reposted from The New York Times

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Beijing Opposes U.S. Rule on Technology Imports

Reuters  |  March 31, 2013  |  The New York Times

BEIJING — China expressed “resolute opposition” and “strong dissatisfaction” with a new U.S. cyberespionage rule limiting imports of Chinese-made information technology products, the state media reported over the weekend.

The remarks underscore growing tension between the world’s top two economies after the United States accused China of backing a string of hacking attacks on U.S. companies and government agencies. China says that the accusation lacks proof and that it is also a victim of hacking attacks, more than half of which originate in the United States.

The new provision, tucked into a funding bill signed into law in Washington on Thursday, requires NASA, as well as the U.S. Justice and Commerce Departments, to seek approval from national law enforcement officials before buying information technology systems from China. The United States imports about $129 billion worth of “advanced technology products” from China, according to a May 2012 report by the U.S. Congressional Research Service.

The Chinese state media, including Xinhua, China Daily and People’s Daily, quoted a spokesman for the Chinese Ministry of Commerce on Saturday as saying the U.S. bill “sends a very wrong signal.”

“This will directly impact partnerships of Chinese enterprises and American business as they conduct regular trade,” said Shen Danyang, the Commerce Ministry spokesman.

“This abuse of so-called national security measures is unfair to Chinese enterprises, and extends the discriminatory practice of presumption of guilt,” the article in the official People’s Daily said, quoting Mr. Shen. “This severely damages mutual trust between the U.S. and China.” The United States should eliminate the law, Mr. Shen said.

The technology security lawyer Stewart Baker wrote in a blog post last week that China could claim that the United States was violating World Trade Organization rules. However, because Beijing has not signed a W.T.O. agreement setting international rules for government procurement, it may not be successful in its challenge, Mr. Baker said.

The Chinese Foreign Ministry spokesman Hong Lei urged the United States at a news conference to abandon the law. “This bill uses Internet security as an excuse to take discriminatory steps against Chinese companies,” he said.