The Price of Yahoo! Sale to China- Free Expression ?

Yahoo, the most visited web portal in the United States, appears to be shopping for a parent company. Jack Ma, the Chairman of Alibaba Group Holding Ltd., China’s largest e-commerce company, has recently said that he is “very interested” in acquiring the U.S.-based company. Such a shake-up may be just what Yahoo is looking for as a means of reviving growth within the company, but it also raises some significant concerns over the maintenance of Yahoo’s human rights obligations as a major repository and purveyor of information on the internet and an early cautionary example of the challenges companies face when pressed by governments to provide sensitive user information.

Seven years ago, at the Chinese government’s request, Yahoo’s Hong Kong office turned over information that led to the imprisonment of  journalist Shi Tao. Yahoo sought to make amends in various ways, including adopting internal policies and joining with other internet service providers and stakeholders to promote a common, rights-based approach to government demands. Human Rights First urges that any potential  Yahoo suitor commit to upholding Yahoo’s existing policies, and its commitments as a member of the Global Network Initiative, as a starting point.

Chinese telecom firm tied to spy ministry- CIA: Beijing funded Huawei

A U.S. intelligence report for the first time links China’s largest telecommunications company to Beijing’s KGB-like intelligence service and says the company recently received nearly a quarter-billion dollars from the Chinese government.

The disclosures are a setback for Huawei Technologies Co. Ltd.’s efforts to break into the U.S. telecommunications market. The company has been blocked from doing so three times by the U.S. government because of concerns about its links to the Chinese government.

The report by the CIA-based Open Source Center states that Huawei’s chairwoman, Sun Yafang, worked for the Ministry of State Security (MSS) Communications Department before joining the company.

Greenpeace Finds Toxic Chemicals NPE in Top Clothing Brands in China, including Adidas and Li Ning

(Epochtimes)- Traces of toxic and hormone-disrupting chemicals have been found in clothes bearing 14 top manufacturing brands, Greenpeace said in its report released on Tuesday in the Philippines and China, where many of the clothes are made.

Nonylphenol ethoxylates (NPE) were found pervading clothing and fabric-based shoes sold internationally by brands such as Adidas, H&M, and Abercrombie & Fitch. NPE breaks down to form nonylphenol, which interrupts biological endocrine functions and harms the reproductive system.

“Scientific research has shown that NPE have direct correlation with premature puberty,” Zhang Kai, who was in charge of the investigation, told Chinese business daily Changjiang Daily. “Experiments have confirmed that these environmental hormones could induce male fish to transform into female fish.”

Suit Claims Cisco Helped China Pursue Falun Gong

SAN FRANCISCO — Cisco, the maker of Internet routing gear, customized its technology to help China track members of the Falun Gong spiritual movement, according to a federal lawsuit filed last week by members of the movement.

The lawsuit, which relies on internal sales materials, also said that Cisco had tried to market its equipment to the Chinese government by using inflammatory language that stemmed from the Maoist Cultural Revolution.

The suit was filed Thursday in Federal District Court for the Northern District of California in San Jose by the Human Rights Law Foundation on behalf of members of Falun Gong. It contends that Cisco helped design the controversial “Golden Shield” firewall that is used to censor the Internet and track opponents of the Chinese government. The lawsuit names several Cisco executives, including the chairman and chief executive, John T. Chambers.

Chinese companies listed on U.S. stock exchanges fell, following two high-profile auditor departures

(Reuters) – Shares of several Chinese companies listed on U.S. stock exchanges fell on Tuesday as investors became more wary of accounting shenanigans following two high-profile auditor departures.

China-based companies’ shares have been under pressure for months amid scrutiny of their books and a spate of shareholder lawsuits alleging accounting fraud.

Jitters intensified this week after one Chinese company said its auditor had resigned and another said an auditor was dismissed.

LinkedIn adds Chinese censorship as risk to IPO

NEW YORK (Reuters) – Following a recent blocking of LinkedIn in China, the social Internet network for professionals warned potential investors in its initial public offering that similar incidents in the future could hurt its value.

In its latest filing with U.S. financial regulators, LinkedIn confirmed that the Chinese government had briefly blocked access to its site and said that such censorship by China or other governments or organizations could lead to the loss or slowing of growth in its member base or member activity.

LinkedIn, which recently surpassed 1 million users in China, has filed with U.S. regulators to raise up to $175 million in a highly awaited U.S. technology IPO, but has yet to set terms and the timing of the offering.

China’s Facebook Syndrome- Censorship hinders access to China’s online markets

Since 2009, China has blocked Facebook, the world’s largest online social media network. This year, Renren, one of China’s largest social networks, plans to raise $500 million on the New York Stock Exchange (NYX). So a Chinese social network can tap U.S. capital markets, but American social networks can’t tap Chinese consumer markets. Does that sound fair?

If Facebook grew corn or built cars, the cry would go out that China was putting up barriers to trade. That hasn’t happened because U.S. officials and politicians have typically viewed China’s Internet censorship as a human rights, not a trade, problem. That’s changing—slowly. The Office of the U.S. Trade Representative, which negotiates trade deals, has been reviewing the idea of Internet censorship as a trade barrier at least since 2007. A nonbinding clause protecting “cross-border information flows” is part of the still-unratified Korea-U.S. Free Trade Agreement. And on Mar. 7 the trade office told Bloomberg Businessweek it is “considering proposals” for stricter language in the Trans-Pacific Partnership, an agreement under negotiation with Pacific-Rim countries such as Vietnam, Australia, and Malaysia (not China).

Six western energy companies Hacked Through China Internet Servers, including Exxon, Shell, BP

Computer hackers working through Internet servers in China broke into and stole proprietary information from the networks of six U.S. and European energy companies, including Exxon Mobil Corp., Royal Dutch Shell Plc and BP Plc, according to one of the companies and investigators who declined to be identified.

McAfee Inc., a cyber-security firm, reported Feb. 10 that such attacks had resulted in the loss of “project-financing information with regard to oil and gas field bids and operations.” In its report, Santa Clara, California-based McAfee, assisted by other cyber-security firms, didn’t identify the energy companies targeted. The attacks, which it dubbed “Night Dragon,” originated “primarily in China” and occurred during the past three years.

Social networking website LinkedIn Is Blocked in China

Feb. 24 (Bloomberg) — LinkedIn Corp., the networking website for professionals, said its service was being blocked in parts of China and that it was looking into the matter.

Just-ping.com and WebSitePulse — services that monitor website accessibility around the world — said earlier that the site wasn’t available in cities including Shanghai and Beijing.

China, the world’s largest Internet market with 457 million Web users, has shut out sites such as those operated by Facebook Inc., Twitter Inc. and Google Inc.’s YouTube since 2009 to block the flow of information on politically sensitive subjects. LinkedIn’s focus on business professionals seeking jobs has shielded it from the same fate as those sites.

Chinese Hackers Targeted a Dozen Oil Companies in U.S. Kazakhstan, Taiwan, and Greece: McAfee

By Sara Yin, PC Magazine, Feb. 10, 2010-

Highly skilled hackers in China have been stealing information from Western oil and gas companies since at least November 2009, according to a white paper from McAfee.

The cybercriminals compromised servers in the United States and Netherlands to infiltrate oil, gas, and petrochemical companies in the United States, Kazakhstan, Taiwan, and Greece. Roughly a dozen companies were penetrated, with five firms confirming the attacks, the report said.

McAfee has nicknamed the coordinated attacks “Night Dragon” for its Chinese origins.

China’s “hostile” audit raised Citi hackles: WikiLeaks

By Susan Cornwell, WASHINGTON-

(Reuters) – China used its regulatory powers to scour the books of Citibank Shanghai in a “hostile” and “extraordinarily intrusive” 2007 audit that appeared primarily aimed at controlling Citi’s growth and uncovering its secrets to success, the bank’s top China executive at the time told U.S. officials.

The charges were contained in the cache of 250,000 U.S. diplomatic cables obtained by the anti-secrecy group WikiLeaks that Reuters has reviewed.

Facebook in China: Connecting with 1bn people – and the censors

Social network chief Mark Zuckerberg photographed meeting boss of Chinese search engine Baidu in Beijing

Mark Zuckerberg thinks that China is not just a place where it would be nice to do business; it’s where the social network’s future must inevitably be found. “How can you connect the whole world if you leave out a billion people?” he asked in October.

And so he began his first visit to the country this week. Just as well it wasn’t a week ago, when China banned pictures of empty chairs as they were considered symbolic of those designated to activist Liu Xiaobo at the Nobel peace prize award ceremony in Oslo. Liu has been jailed in China for “inciting subversion of state power”.

Chinese Antivirus Companies Create the Viruses They Kill

By Li Ping, Epoch Times Staff, Dec 12, 2010-

A well-placed Chinese security official has been given a suspended death sentence for taking bribes in exchange for his role in an antivirus software fraud scheme.

Yu Bing, former director of the Internet monitoring department of Beijing’s Public Security Bureau, had his agency send out a “virus warning” telling the public to download software from the company Rising Antivirus, to combat a particular computer virus.

But that virus was itself devised by Rising Antivirus, who bribed Yu to send out an email to drum up business, according to a Dec. 2 First Financial Daily report.

Google exec in China says no knowledge of WikiLeaks claim over China attack

AFP, Dec. 7, 2010 –

BEIJING — A senior executive for Google said Tuesday the firm had “no firsthand knowledge” of information in leaked US diplomatic cables linking China’s top propaganda official to cyberattacks on the US web giant.

In January, Google said it had fallen victim to attacks by China-based cyber spies apparently intent on hacking into the Gmail accounts of Chinese human rights activists, touching off a huge battle with Beijing on censorship.

Diplomatic messages leaked by WikiLeaks point to Li Changchun, the senior Chinese Communist party official in charge of propaganda, as the overseer of the attacks against Google and 20 other companies.

Wikileaks- Who led Google China hacking? Two Politburo Members, Li Changchun and Zhou Yongkang

(Reuters) – The hacking of Google Inc that led the Internet company to briefly pull out of China was orchestrated by two members of China’s top ruling body, according to U.S. diplomatic cables released by WikiLeaks and cited by The New York Times on Saturday.

Citing the cables, the Times said China made repeated and often successful hacking attacks on the U.S. government, private enterprises and Western allies as far back as 2002.

Google urges western governments to challenge foreign internet censorship

Josh Halliday, guardian.co.uk, Tuesday 16 November 2010 –

Google is urging western governments to challenge internet censorship in countries such as China, saying the economic implications of stifled trade will become more grave if nothing is done.

“More than 40 governments now engage in broad-scale restriction of online information, a tenfold increase from just a decade ago,” the US-based technology giant warns in a policy brief on internet trade restrictions published yesterday.

In Chinese Internet Rumble, User Rights Not the Focus

By Matthew Robertson & Michelle Yu, Epoch Times Staff, Nov. 8, 2010 –

A public spat has erupted recently between two Chinese Internet giants after the country’s most popular chat software, QQ, was found to be harvesting user data; it was exposed by an anti-virus software maker that itself has a shady background. The case illustrates both the opaque nature of Internet regulation in China and how the rights of users get trumped by corporate interests, who often benefit from links to the Party bureaucracy.

In a test conducted by a Shanghai News Daily reporter on Sept. 27, anti-virus software produced by the company Qihoo 360 identified 525 documents that QQ scanned in five minutes, earmarking 110 as potentially compromising the privacy of its users. Files from MSN Instant Messenger, Windows Live Mail, Google Search, and Microsoft Office were among those scanned.

Microsoft boss decries software piracy by China firms

MADRID — Microsoft chief executive Steve Ballmer on Friday decried the use of pirated software by Chinese businesses.

“One of the things that has improved a lot around the world is business piracy, and yet when we look at China today business piracy is more extreme than consumer piracy,” he told a business forum in Madrid.

Foxconn accused of exploiting workers in China: survey

SHANGHAI — IT firm Foxconn faces renewed pressure over conditions at its factories after state media said Friday it had been accused of forcing staff in China to work excessive overtime while exploiting interns.

The results of a survey of employees at Foxconn come just months after a spate of suicides at the Taiwan company’s plants in China, including 10 at its Shenzhen facility which employs an estimated 400,000 workers.

Researchers questioned 1,736 workers at plants in nine cities and found they worked an average 83.2 hours overtime a month, more than twice the maximum 36 hours allowed under Chinese law, the China Business News said.

AI Warns Drug Companies of China’s illegal practices of Organ Transplant

The growing organ transplant industry in China has attracted investments of foreign pharmaceutical companies, specializing in organ transplant drugs. But a representative from Amnesty International in Switzerland says these companies need to consider more than just business when engaging with China because of the illegal practices taking place there.

[Danièle Gosteli, Economy & Human Rights, Amnesty International, Swiss Action]:
“Of course if an international company knowingly participates and continues to do so even with the knowledge of organ trade, this would have a very bad effect on its reputation.”

IPhone Demand Outstrips Supply in China

By OWEN FLETCHER, wsj.com, Sep. 25, 2010 –

BEIJING— China Unicom (Hong Kong) Ltd. said its supply of Apple Inc.’s iPhone 4 handsets is insufficient to meet user demand but that it will increase its supply as quickly as possible. Sales of the model started at a much faster pace than when older versions of the iPhone went on sale in China last year.

Unicom had received more than 200,000 iPhone 4 preorders by early Saturday, the day sales started, and more than 40,000 buyers received the phone and a bundled mobile-service plan that day, Unicom said. By comparison, Unicom last year sold 100,000 iPhone handsets in roughly six weeks after officially introducing the devices in China in late October.

The latest version of Apple’s popular smartphone was widely awaited in China and could help Unicom attract more users to its third-generation mobile services, which are more expensive but offer faster data speeds than typical services. Unicom, the only network operator in China to offer the iPhone, is competing with rivals China Mobile Ltd. and China Telecom Corp. to build its 3G subscriber base.

An Apple spokeswoman said more iPhones will be available soon and that customers should check online or with local stores regarding availability…...(more details from Wall Street Journal)

Businesses forced to hand over technology and accept Chinese partners

By He Qinglian, Chinese economist, Via The Epochtimes, Aug. 21, 2010 –

Foreign businessmen in today’s China live in fear. Other businesses smugly observed and waited out the face-off between Google and the Chinese regime, assuming Google had overestimated its clout.

If Western businessmen were smirking at Google’s predicament, the publication of the Chinese regime’s “Several Opinions of the State Council on Further Doing a Good Job in the Utilization of Foreign Investment” wiped that smirk off their collective faces. The gist of the article: “The age of unconditional priority given to foreign investments in China” is now over.

Differing Opinions

Some foreign investors still dream of yesteryear’s privileges, hoping Chinese officials would listen and reconsider. This time they aired their dissatisfaction publicly instead of resorting to private lobbying.

The American Chamber of Commerce (China) and the European Union Chamber of Commerce in China have published reports. These reports show the deep concern from the American and European business community over China’s protectionist policies.

On July 7, The World Bank Group published its 2010 report “Investing Across Borders,” listing China as one of the countries with the greatest limits on foreign investment. In mid-July, a number of international companies publicly criticized China’s commercial climate in a meeting with Premier Wen Jiabao. The companies included Siemens and BASF.

The foreign companies’ chief dissatisfactions falls in three areas.

First, their intellectual property is not protected. New rules force foreign companies to hand over trade secrets and new technologies to their Chinese partners in exchange for a market share.

Second, foreign investment companies, unlike their Chinese counterparts, are treated unequally in state bids.

Third, China has many rules applying to mergers and acquisitions. Foreign companies are required to partner with Chinese businesses, and the split must be 50-50.

Chinese officials, led by Premier Wen Jiabao, have disputed these barriers. Liu Yajun, director of the Department of Foreign Investment Administration of the Chinese Ministry of Commerce, rejected the World Bank’s findings at a press conference.

Minister of Commerce Chen Deming told the U.K.-based Financial Times that China repeatedly lowered the entry barrier for foreign companies since it joined the WTO, and many international companies severely affected by the global financial crisis have found new revenue sources in China…...(more details from The Epochtimes)

China jails Tibetan property tycoon for life time

Jane Macartney, The Times, Via The australian, August 13, 2010 –

CHINA has sentenced to life imprisonment a property tycoon believed to be the country’s richest Tibetan businessman.

Once hailed by authorities as one of Tibet’s top ten outstanding young people, Dorje Tashi, 37, was sentenced on June 26 by the Lhasa Municipality Intermediate People’s Court, Tibetan sources told The Times.

Dorje Tseten, his elder brother, was jailed for six years.

Details of the charges were not available, but if they were political then such secrecy is not unusual in Tibet – where officials are anxious to avoid further unrest.

Many in the deeply Buddhist population resent Beijing’s rule and yearn for the return of the exiled Dalai Lama.

The absence of any reports in China’s state media underscored the possibility that the arrests may have been related to activities deemed political.

However, court sources said that the conviction was based on “illegal business operations” involving Mr Dorje’s Yak Hotel, the best-known and oldest in Lhasa – the capital of the region.

The court confiscated Mr Dorje’spersonal property, estimated to be 4.3 billion yuan ($707 million). He was arrested in March 2008, shortly after an anti-Chinese riot rocked Lhasa, even though he had been praised at the time for supporting the government crackdown and providing supplies to security forces.

Mr Dorje was well known in Lhasa after he founded the popular hotel.

He operated many other enterprises, from property to trading companies, and had close links with Chinese authorities. Shortly after his arrest, however, there were reports that he had made donations to monasteries, or even the Dalai Lama – donations which would have enraged Beijing.

– The Australian