The Global Economy and the On-Line World: Consequences of WTO Accession on the Regulation of the Internet in China

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CONTENTS  I     Introduction II    China and the WTO         A   China's Entry into the WTO         B   Obligations of WTO Member Nations III   Regulation of the Internet in China         A   Regulations Prohibiting Use of the Interact for Political             and Illegal Purposes         B   Regulatory Tools for Enforcing Internet Censorship in China               1   Encryption Regulations               2   Registration Requirements               3   A Single International Gateway to the Internet IV    Enforceability of WTO Rulings V     Conclusion 

I INTRODUCTION

When 10 000 members of the Falun Gong sect descended on Zhongnanhai (1) for a silent protest in April 1999, it came as a complete surprise to China's leaders. It also horrified them--with the tight integration of the State into almost every aspect of Chinese life, (2) they simply could not understand how a protest of such magnitude could have been arranged without Governmental knowledge. (3) There seemed only one explanation: the sect members had organised their protest using the Internet, that vast, notoriously unregulatable, (4) product of the digital age. The size of the protest underlined the potential of the new medium as a forum for political discussion and disturbances--a clear threat to the power base of the Chinese Communist Party (`CCP'). The CCP reacted swiftly and brutally in response to this threat, completely shutting down Chinese access to the Internet the day after the protest. (5) Even when the Internet reopened three days later, access to all Falun Gong websites had been blocked. (6)

The closure and subsequent censoring of the Internet in the wake of the Falun Gong protest is indicative of the uneasy relationship between the CCP and the Internet. On the one hand, the Government has vigorously encouraged the use of the Internet and its assimilation into Chinese society, seeing the new technology as a fundamental part of its modernisation drive. (7) Yet on the other hand, widespread use of the Internet violates the fundamental Leninist requirement that the State must tightly control the flow of information and ideas to the people. (8) The CCP's contemporaneous devotion to Leninism and modernisation has meant that the Government's regulatory approach to the Internet has been somewhat inconsistent and contradictory. Indeed, it has been asserted that China is `embarking on the information superhighway with one hand on the wheel and the other hand on the plug'. (9)

So far, China has managed to monitor and control the Internet without severely hindering the economic development it promises. (10) However, this delicate balancing act is clearly threatened by the external disciplines that will be enforced against China in the wake of its accession to the World Trade Organization (`WTO') in late 2001. Due to the recent explosion in the amount of international trade and business on-line, the Internet is increasingly coming within the scope of the WTO trade rules, which require free and open access to the markets of member nations. The purpose of this paper is to examine the regulations currently used by China to monitor, control and censor the Internet, and to determine whether these regulations are consistent with current WTO rules. It will be shown that regulations governing the Internet in China can be divided into two categories: first, laws forbidding the use of the Internet for any political or illegal purpose (`censorship laws'); and secondly, regulations which China has enacted to enforce these censorship laws. It will be argued that although the censorship laws themselves may be WTO-compliant, some of the regulatory tools China uses to enforce the censorship laws may be WTO-noncompliant.

Part II of this paper examines the WTO, its trading rules and the issues involved in China's accession. Part III will analyse the WTO-compliance of the various laws and regulations used to control the Internet in China. …