United Kingdom

Happy New Year! Here is a quick round-up of this week’s technology headlines and related stories you may have missed while you were binging on Netflix, eating turkey or Chinese food, and ringing in 2016. 1. The first publically-known cyberattack to take down a power grid? Ukraine’s energy ministry accused Russia perpetrating a cyberattack that caused a power outage, affecting several hundred households on December 23, 2015. If true, this is the first known instance of hackers disabling a power grid. Some press reports have attributed the attack to malware known as “BlackEnergy,” while others have pointed to a group of Russian hackers called “SandWorm.” However, as Robert Lee has pointed out, there’s not yet enough information about the attack to come to a conclusion. In the meantime, U.S. companies that rely on industrial control systems should review their defenses and keep their ears open for new information on the incident in Ukraine as it becomes available. 2. Chinese regulators suspect Microsoft of antitrust. Chinese regulators have reignited a probe into alleged monopoly practices by Microsoft first started in summer 2014 when officials raided the company’s Chinese offices, seizing documents and hard drives. The State Administration for Industry and Commerce says that “major questions” remain regarding the data seized in the 2014 raids. Microsoft’s China troubles should be a red flag for other foreign firms hoping to do business in China. Despite hosting leaders of Chinese and U.S. tech companies for a meeting with Chinese President Xi Jinping and launching a new partnership with a Chinese government-owned electronics firm in the last few months, Microsoft can’t seem to get a break. Nor is the environment in China for foreign tech companies likely to get better any time soon. Last month, the Chinese legislature passed a counter-terrorism law that authorizes the government to require telecoms to assistance in terrorism investigations, which includes handing over encryption keys. 3. The Netherlands and the United Kingdom disagree over encryption. The Dutch government issued a statement in which it ruled out pursuing legislation that would limit the "development, availability and use of encryption" within the Netherlands. In other words, the Dutch government has decided that it will not legislate the creation of "back doors" that would allow law enforcement from decrypting communications. That approach differs considerably to that of the United Kingdom, where the government is currently seeking comment on a draft law that would, among other things, require communications providers to have the ability to decrypt communications, retain metadata on their customers, and explicitly authorize UK law enforcement to engage in offensive cyber operations against terror suspects. Tech companies have roundly criticized the UK proposals, noting that they would have far-reaching consequences in reducing user security and privacy. Last week, NetPolitics contributor Lincoln Davidson recently took a look at the encryption issue in our top five cyber issues of 2015 series. You can check it out here. 4. More questions than answers over unauthorized code in Juniper software. Last month, Juniper Networks, one of the largest sellers of networking products, announced that it had discovered unauthorized code in some of its NetScreen firewall software that would allow a potential attacker to decrypt VPN traffic. The fact that Juniper called it unauthorized code instead of a software flaw (i.e. an error in the way the code was written) suggests that it was deliberately placed and probably the work of an intelligence agency. That led some to believe that the flaw was the work of the NSA, given that some of the Snowden documents refer to NSA operations against Juniper products. While Juniper has not further commented on what the unauthorized code contained, it would seem that Juniper deliberately undermined the security of NetScreen. According to Kim Zetter at WIRED, the company incorporated an algorithm into NetScreen’s code and configured it in a manner that would make it more vulnerable to compromise. It’s unclear why Juniper would do this--and Zetter does not speculate. The mystery is likely to become the best cyber-related whodunit of 2016.

Sanja Kelly directs the Freedom on the Net project at Freedom House. It has been a tumultuous few weeks in the world of Internet freedom. Among several high-profile arrests, a blogger in Kuwait was sentenced to four years in prison, with hard labor, for posting critical comments about Saudi Arabia on Twitter, allegedly affecting a cordial relations between the two countries. And in Bangladesh, six social media and messaging apps—including Facebook and WhatsApp—were blocked indefinitely amid “security concerns.” These disconcerting developments, unfortunately, are not isolated incidents. They are a part of a growing trend by governments to limit what can be said and done online. According to a new edition of Freedom on the Net, Freedom House’s annual assessment of online censorship released in late October, Internet freedom around the world has declined for the fifth consecutive year.  Of the sixty-five countries assessed, thirty-two have been on a negative trajectory since June 2014. Intensified censorship, growing surveillance, crackdown on encryption and anonymity, and more frequent arrests for online activities were identified as some of the most worrisome trends. China was the year’s worst abuser of Internet freedom. As President XI Jinping made “cyber sovereignty” one of the priorities of his tenure as leader of the Chinese Communist part, Internet users endured crackdowns on “rumors,” greater enforcement of rules against anonymity, and disruption to the circumvention tools that are commonly used to bypass censorship. Though not entirely new, these measures were implemented with unprecedented intensity. Google, whose services were frequently interrupted in the past, was almost completely blocked, veteran human rights defenders were jailed for online expression, and official directives during the year suppressed online commentary on topics ranging from Hong Kong pro-democracy protests to stock-market volatility. Globally, in a new trend, many governments have sought to shift the burden of censorship to private companies and individuals by pressing them to remove content, often resorting to direct blocking only when those measures fail. Local companies have been especially vulnerable to the whims of law enforcement and a recent proliferation of repressive laws. But large, international companies like Google, Facebook, and Twitter have faced similar demands due their significant popularity and reach. In some instances, instead of turning to tech companies, authoritarian governments have gone directly to individual content creators and coerced them into deleting material. In Bahrain, for example, after the arrest of the user behind the satirical Twitter account @Takrooz, almost 100,000 tweets were deleted. Only one tweet remained: “They tortured me in prison.” Undeterred by the international backlash against surveillance following the NSA revelations, most governments have continued to strengthen their surveillance capacity—through new legal measures and through new technical means. This trend was evident in both democratic and non-democratic countries. For example, Australia, Italy, and the United Kingdom instituted new data retention requirements. However, this trend is even more concerning in countries where Internet freedom violations occur more frequently. Russia, for example, required ISPs to update their surveillance technologies, and many other former Soviet republics followed suit.  Meanwhile, in Thailand, where authorities frequently arrest users for criticizing the royal family on social networks, one of many orders issued by the military government in 2014 mandated military surveillance of social media sites. It is not a surprise then that given the mounting concerns over government surveillance, companies and Internet users have taken up new tools to protect the privacy of their data and identity. Unfortunately, some governments have moved to limit encryption and undermine anonymity for all Internet users, often citing the use of these tools by terrorists and criminals. In August 2015, for example, three staff members working for Vice News were arrested in southeastern Turkey and charged with supporting terrorists after authorities found encryption software on one of their computers. Similar accusations were brought against three Al-Jazeera journalists who were detained in Egypt and Zone 9 bloggers in Ethiopia. While our research has previously noted an increase in offline punishments for online expression, the penalties and reprisals reached a new level of severity in the past year, as both authorities and criminal groups made public examples of Internet users who opposed their agenda. Of the sixty-five countries, forty imprisoned people for sharing political or social content through digital networks.  In Iran, a cartoonist was sentenced to twelve years in prison for posting an image on Facebook that depicted members of parliament as animals. Sentences issued during 2015 for alleged online insults to Thailand’s monarch have exceeded twenty-five years in prison. And in China, an academic was sentenced for lifetime imprisonment, partly for running a website on Uighur affairs. In many ways, the past year was one of the consolidation and adaptations of Internet restrictions. Governments that had already greatly expanded their arsenal of tools for controlling the online sphere are now strengthening their application of these methods. It remains to be seen whether repressive efforts will be sustainable in the long run. Although their impact has so far been limited, activists in many countries have become better informed and better equipped to push against deteriorating conditions for global Internet freedom. It is their efforts that could help ensure that the fight for a free and open Internet ultimately succeeds, despite the setbacks that have affected so much of the world in recent years.

What exactly is the objection to UK Chancellor George Osborne’s desire for the United Kingdom to be Beijing’s “best partner in the West” and to have a “relationship that is second to none”? After all, there is not a country on earth that does not want to have a robust trade and investment relationship with China, the world’s second largest economy. Yet critics in and outside the United Kingdom seem taken aback by Osborne’s willingness to state up front what many countries also so clearly desire—a direct line into an economy that is one of the world’s most significant engines of growth. In many respects, Osborne is only seeking to strengthen an already fairly dense set of UK-China economic ties. British banks have the largest exposure to the Chinese economy of any banks in the world: by the end of August 2015, they had $221.2 billion in outstanding loans to China, roughly two-and-a-half times the amount held by American banks. Chinese also represent the largest overseas purchasers of luxury real estate and the largest source of overseas students in the United Kingdom. Moreover, the United Kingdom is China’s largest recipient of foreign direct investment in the European Union. And the two countries appear to have reached consensus that London will become a “centre for renminbi trading, clearing and settlement.” Where the United Kingdom falls down a bit is on trade: China is only the United Kingdom’s seventh-largest market for exports (although it is the United Kingdom’s second-biggest supplier of imports). So what is the fuss? It is, in part, as Philip Stephens has noted in the Financial Times, that the “United Kingdom assumes an economic relationship requires submission on everything else.” Most obviously, as a result of Osborne’s economic focus, human rights issues appear not just lower on London’s agenda with Beijing, but not on the agenda at all. Although Prince Charles has at times spoken out in support of the Dalai Lama and Tibetan rights, and Prince William recently recorded a speech calling for China to do more to end the illegal ivory trade, the UK government has not displayed a similar willingness to publicly raise concerns with China. Over the past two years, Prime Minister Cameron refused to meet with the Dalai Lama; Chancellor Osborne traveled to Xinjiang, one of the most politically repressed regions of China, without mentioning human rights; the British ambassador to China refused to grant Chinese artist Ai Weiwei a six-month visa (a decision that was later reversed); and the United Kingdom agreed to move its exhibition in Beijing of the Magna Carta—a document that represents a cornerstone of democratic principles, guaranteeing individual rights and the rule of law—from an agreed upon exhibition space at Renmin University to a far smaller space for only a few hours at the British ambassador’s residence. There are also security concerns at stake. If indeed Beijing is to be London’s new best friend in the West, what does that mean for defense consultations between London and its traditional treaty allies? Will the United Kingdom become a proxy for Beijing in discussions about security in the Asia-Pacific?  Already, Prime Minister Cameron refused the opportunity while in Singapore to offer his thoughts on Asian security issues—despite the United Kingdom being a member of Asia’s Five Power Defence Arrangement—apparently afraid of offending Beijing. Last but not least, there are simply the optics. Osborne could no doubt have realized the same degree of Chinese investment and trade opportunities without sacrificing a healthy chunk of the United Kingdom’s international image and perhaps self-respect. Many countries, Germany and the United States among them, manage to have robust trade and investment relationships with China yet are not afraid to press China publicly to recognize the basic political rights the Chinese constitution grants its citizens. Those countries that do not—Zimbabwe, Pakistan, and Russia, for example—hardly seem the kind of company that London wants to keep. Financial Times columnist Gideon Rachman offers a very thoughtful essay considering how the United Kingdom’s China policy might affect the U.S.-UK relationship, and I agree with much of what he says. But in truth, the United Kingdom’s decision about how to balance its relative political, economic, and security interests and define its policy toward China is not about the U.S.-UK or U.S.-China relationships. It is about the United Kingdom: the character of the country and, even more, of the people who lead it.