China’s Great Firewall

For the first time this year, the United States Trade Representative’s (USTR) ‘National Trade Estimate Report’ took note of China’s Great Firewall. Granted, it was with this tame statement: ‘China’s filtering of cross-border Internet traffic has posed a significant burden to foreign suppliers’.

For the first time this year, the United States Trade Representative’s (USTR) ‘National Trade Estimate Report’ took note of China’s Great Firewall. Granted, it was with this tame statement: ‘China’s filtering of cross-border Internet traffic has posed a significant burden to foreign suppliers’.

The report did not indicate what steps, if any, the United States plans to take against China’s heavy-handed and economically damaging censorship regime. However, it is high time for the United States, possibly in conjunction with other major trading partners, to test the legality of China’s sweeping internet censorship system.

Chinese online censorship operations are not new; they have been well documented for over a decade. However, the situation has grown worse since President Xi Jinping took office in 2012. Today, the USTR reports that eight of the 25 most trafficked websites worldwide are currently blocked by the Chinese government. Especially targeted are popular search engines such as Google, as well as user-generated content platforms such as Twitter, YouTube and Facebook.

Sometimes, the blockade is permanent — Google formally withdrew from China in 2010 — but more often, it is intermittent and random, as has occurred with increasing frequency with Gmail and Hotmail. The New York Times has been banned since 2012 and recently (because of reporting on the misdeeds of President Xi’s relatives) The Economist and Time magazine have secured spots on the honoured block list.

Recently, Beijing further tightened the screws on US companies when it imposed a ban on Apple’s online book and film services. The order came as part of a broader set of regulations, introduced in March, which established strict curbs on all online publishing.

In many cases, the filters and blocks carry with them a strong whiff of industrial policy. The now-giant Chinese firm Baidu received a huge boost when Google was forced to withdraw from the Chinese market. Baidu stock shot up 16 percent the day Google announced its withdrawal.

Sina’s Weibo and Tencent’s QQ are direct competitors to popular blocked websites such as Twitter and Facebook. Even a seemingly innocuous photo-sharing site, Flickr, has been banned, much to the benefit of a direct Chinese competitor, Bababian, which has blossomed with the aid of foreign technology.

When challenged to defend its ‘purge’ of foreign internet firms, Chinese officials invoke WTO escape clauses that allow governments to intervene to protect ‘public morals’ or ‘public order.’ However, there are several legal challenges the United States could raise, based on WTO rules.

First, when China achieved WTO membership, it assumed substantial obligations under the WTO’s ‘General Agreement on Trade in Services’ (GATS). GATS imposes a number of across-the-board mandates relating to transparency, impartiality, non-discrimination in government actions and opportunity for independent judicial review of administrative decisions.

With respect to Chinese internet censorship, the rights of foreign companies outlined in GATS have rarely been honoured. Often, China has provided no prior notice or explanation of its actions, no reference to a particular law or regulatory rule and no provision for appeal to an independent body. These due process violations could form one route for arguing a WTO case.

However, there are potentially deeper, more specific WTO rules violations. China (and other WTO members) have undertaken direct commitments regarding individual sectors, specifically commitments relating to web-based services and broader value-added telecommunications services.

While there has been no case that directly challenges online censorship by WTO members, there is WTO case law suggesting that WTO panels and the WTO Appellate Body would rein in sweeping censorship rules.

In a 2005 case regarding online gambling, which pitted the United States against Antigua, the WTO Appellate Body ruled that once a WTO member had agreed to commitments regarding a service sector (in this case the United States with gambling), it could not maintain GATS-violating bans on that sector.

Specifically, it held that bans would be considered ‘zero quotas,’ which violate GATS rules in liberalised sectors.

In a more recent case involving China’s attempt to regulate and ban the import of US publications and audio-visual material, the Appellate Body refused to accept China’s invocation of public morals as a defence for widespread bans on foreign books and movies.

The WTO thus clarified that the public morals exception could only be invoked for narrow, individual circumstances and was not a license for unrestricted censorship.

The key issues going forward relate to necessity and proportionality. That is, did China have other means to achieve the protection of public morals, and were their actions proportional to the goal? Here, the question of ‘selective filtering’ (censoring) versus a total ban comes to the forefront.

As the authors of a leading academic study of these issues state: ‘It is self-evident that active filtering of search results is less trade restrictive than a total, permanent ban of the site since the latter course would at least preserve the economic rights of the foreign undertaking.

The mere existence of selective filtering strongly argues that arbitrary and entire blockages or permanent bans on sites based on search-and-retrieve functionality ought to be considered as disproportionate’.

Though there are still complexities and unanswered questions relating to the use of the WTO legal system, the cases cited above have both direct and broad implications for China’s extensive censorship operations.

The logic of these decisions would seem to create strong grounds for challenging China’s sweeping, total bans on services provided by Google, Facebook, Twitter and many other foreign-based operations. It is time for the Obama administration to test the implications and reach of the WTO judicial body’s decisions with a case directly challenging China’s internet censorship.

A WTO challenge to China’s internet censorship is long overdue is republished with permission from East Asia Forum