Explained | What are the amendments to China’s anti-espionage law?

The amendments come amid a string of high-profile cases involving journalists, foreign executives, as well as international companies in China, who have come under the lens of authorities on national security grounds.

Updated - May 02, 2023 12:51 pm IST

Published - May 01, 2023 10:46 pm IST

The amendment can be seen as part of the policy shift that now emphasises the dual importance of “development and security”

The amendment can be seen as part of the policy shift that now emphasises the dual importance of “development and security” | Photo Credit: Getty Images

The story so far: On April 26, China’s legislature approved sweeping amendments to China’s anti-espionage law, broadening the scope of what may be defined as activities related to spying and national security. The amendments come amid a string of high-profile cases involving journalists, foreign executives, as well as international companies in China, who have come under the lens of authorities on national security grounds. The expanded law follows the Xi Jinping government’s increasing focus on “security” and a recent policy shift that now emphasises the dual importance of “development and security”, rather than a focus solely on economic development.

What is China’s anti-espionage law?

The recent amendments are to China’s 2014 anti-espionage law. Article 1 of the law says the idea behind the legislation is “to prevent, stop and punish espionage conduct and maintain national security.” The broad ambit of what constitutes “national security” as well as the law’s focus on involving a “whole of society” approach to counter-espionage, including from Chinese enterprises and organisations, evoked concerns among both rights groups and foreign enterprises in China.

Foreign governments are especially concerned whether Chinese companies, particularly in the tech sector, would be mandated to offer their vast amounts of data to the authorities. For instance, one article of the law mandates that “all State organs, armed forces, political parties and public groups, and all enterprises and organisations, have the obligation to prevent and stop espionage activities and maintain national security.”

Another article encourages ordinary citizens to take part in national anti-espionage efforts by reporting to the authorities any activity deemed to be suspicious and endangering national security.

The latest amendments are the first changes since 2014, and will take effect on July 1, 2023. They have further broadened the law’s scope, with one of the changes declaring that “all documents, data, materials, and items related to national security and interests” will be protected on par with what are deemed state secrets.

The definition of espionage has also been expanded to include cyber attacks. Essentially, the transfer of any information deemed by authorities to be in the interest of what they define to be “national security” will now be considered an act of espionage.

What prompted the changes?

Zang Tiewei, spokesperson for China’s National People’s Congress (NPC), the ceremonial Communist Party-controlled legislature, said the latest change “improves the regulations on cyber espionage” and “clearly defines cyberattacks, intrusions, interference, control and destruction” as espionage. Other changes, he said, would include “clarifying the responsibility of national security organs in guiding and arranging publicity as well as provisions to strengthen the protection of personal information in counter-espionage work.”

The amendments have also coincided with a number of recent high-profile cases which observers have seen to reflect a broadening scope for “anti-espionage” activities as well as widening definitions of “national security”.

Only days before the amendments were approved, the family of a senior Chinese newspaper editor, Dong Yuyu, said he had been arrested almost a year ago while meeting with a Japanese diplomat and for his contacts with the Americans and Japanese. He has been accused of spying.

The cases of two other journalists have also drawn wide attention. In June last year, Bloomberg News reported that a journalist at its Beijing bureau, Haze Fan, had been released on bail pending trial in January 2022, citing a statement from the Chinese Embassy in the U.S., but it had not been able to contact her. Cheng Lei, an Australian reporter and television anchor with the State run English-language channel China Global Television Network (CGTN), was in 2020 detained and accused of carrying out activities “endangering national security”. Till date, no details have been made public on both their cases. However, it isn’t only journalists who are under the lens of the authorities.

During the end of March, a prominent figure in the Japanese business community in China and an executive at Asellas Pharma, Hiroshi Nishiyama, was detained and accused of espionage. So far, little detail has also been provided on his case, in keeping with cases involving “national security”.

What will be the impact of the amended law?

The amended law is likely to have a chilling impact both within China and beyond. Chinese journalists, academics and executives who frequently engage with foreign counterparts are likely to think twice before doing so, at least without explicit government sanction, particularly in the wake of the arrest of Dong Yuyu. Unrestricted engagement between Chinese and foreign scholars, which has already become limited in the Xi Jinping era, is likely to become even rarer.

Foreign enterprises are also likely to be concerned following recent reported investigations by Chinese authorities on the U.S. consulting firm Bain & Company and a raid on the American due diligence company Mintz Group.

Indian companies with a presence in China, particularly in sectors deemed to be sensitive such as pharma and IT, will likely need to review their exposure to risks under the expanded law and broadened definitions of “national security”, particularly amid deteriorating relations between the neighbours.

Chinese State media have, however, sought to push back against suggestions that the law signals a chilling in China’s business environment.

The Communist Party-run Global Times in a recent commentary hit out at Japanese media for suggesting this was the case following the arrest of the Astellas executive, saying it was “a far-fetched slander that twists the facts.”

The newspaper quoted the Chinese Foreign Ministry as saying, in the wake of the case, that “as long as one operates within the law, there is nothing to worry about.” The concern for many companies, however, is that the law doesn’t spell out what may or may not be a “national security” issue.

The Global Times argued that “an increasing number of espionage cases against China have been found” since 2014, requiring the amendments. “This fully demonstrates the necessity and urgency for China to update its anti-espionage law to protect its national security. No one is in the position to criticise China’s legitimate actions,” the newspaper said, “and no one has the right to use this to throw mud at China’s business environment.”

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