On May 19, the PRC Ministry of Industry and Information Technology (“MIIT”) issued a controversial regulation, entitled “Notification Regarding the Requirements for Pre-installation of Green Internet Filtering Software on Computers,” requiring all computer manufacturers to equip computers and PDAs for distribution in the Chinese market as of July 1 with “Green Dam Youth Escort” filtering software. The controversy, originating both from within China and abroad, included concerns over anti-trust, copyright infringement, and security and privacy issues. Despite efforts by MIIT to assure the public of the reasonableness of the regulation, it postponed implementation of the regulation just prior to the July 1 deadline. The Minister of MIIT further revealed in a press release on August 13 that MIIT has no intention to force the installation of Green Dam in every computer other than those sold to public areas such as net bars and schools and MIIT is still considering how to implement the regulation better. Despite the postponement, reports indicate that some manufacturers shipped computers bundled with the software.

The government sought to develop the Green Dam software to limit access to Internet content deemed “potentially damaging,” and to build on the government’s “Special Campaign to Restore the Internet from a State of Vulgarity.” Unlike previous methods of Internet censorship employed by the Chinese government which controlled content at the ISP and ICP levels, Green Dam, dubbed “The Filtering Bully” by Chinese Internet users, represented a new form of monitoring that linked computers and users directly to databases of prohibited sites and blocked access to prohibited addresses.

Some of the more prominent criticisms from sources such as Chinese legal experts, technology providers, international organizations, governments, and Internet users are summarized below.

  1. Anti-trust complaints. Two Chinese law professors brought complaints to MIIT and the Anti-monopoly Committee stating that MIIT’s exclusive specification of Green Dam software represented a breach of China’s Anti-Monopoly Law (“AML”). The professors argued that the government abused its authority and excluded competition in violation of Articles 8, 32 and 37 of the AML to the extent it did not allow other software manufacturers to develop competitive filtering products.
  2. Consumer rights violations. Article 9 of China’s Consumer Protection Law provides that consumers have discretion in choosing products and services. Thus, pre-installation of Green Dam software breaches consumers’ rights to Internet filtering software options.
  3. Security and privacy. A University of Michigan analysis of Green Dam software revealed various security vulnerabilities, potentially allowing malicious sites to steal private data, send spam, or transform personal computers into “botnets,” which allow hackers to control computers installed with Green Dam.
  4. Copyright infringement. The authors of the University of Michigan study also suggest that a number of blacklisted files used by the Green Dam software were taken from the American-made censorship program CyberSitter. Other reports indicated that Green Dam lifted code libraries and configuration files from another software company. Solid Oak, a small US software company, said it had evidence to support a copyright infringement claim against Green Dam’s developers.
  5. International trade concerns. The US government met with representatives of the Chinese government, notifying them of concerns with respect to potential international trade violations surrounding the implementation of the Green Dam regulation.

Regulators Crackdown on Google

The month of June also saw the government temporarily shut down some Google search functions after a report released by the China Internet Illegal Information Reporting Center indicated that Google China’s search engine contained “vulgar” online search results. Soon after the report was released, Google was the subject of intense public criticism including substantial television coverage from China’s central television station (“CCTV”). Industry followers and Chinese Internet users noted that similar search results could be found at any number of Google competitors, foreign and domestic. Mr.Li Kaifu, the president of Google’s China operations, was asked to meet with Chinese regulators to discuss this issue and develop solutions to the problem. Google promised to strengthen its control of “vulgar” online search results in China in order to assure compliance with PRC laws and regulations.

Given the extent of coverage by the Chinese government and media on the issue of pornography and Internet use, and criticism directed at Google China’s management of Internet searches for pornographic content, we can expect more developments on the Green Dam/censorship front in the future. This is not an easy issue for regulators from any country to tackle. China’s first major attempt at implementing regulatory measures at the consumer level did not work out as planned, but it probably won’t be the government’s last. Given the extent to which Google appeared to be singled out from some of its domestic competitors, foreign service providers and technology companies should be particularly sensitive to heightened oversight and potential investigations from PRC regulators.