Tag Archives: free flow of data

Tesla as Catfish: When China Carps-Tech CEOs Fall in Line

Many countries are wrestling with how to regulate digital records. Some economies, including in Europe, emphasize the need for data privacy, while others, such as China and Russia, put greater focus on government control. The U.S. currently doesn’t have a single federal-level law on data protection or security; instead, the Federal Trade Commission is broadly empowered to protect consumers from unfair or deceptive data practices.

Behind China’s moves is a growing sense among leaders that data accumulated by the private sector should in essence be considered a national asset, which can be tapped or restricted according to the state’s needs, according to the people involved in policy-making. Those needs include managing financial risks, tracking virus outbreaks, supporting state economic priorities or conducting surveillance of criminals and political opponents. Officials also worry companies could share data with foreign business partners, undermining national security.


Beijing’s latest economic blueprint for the next five years, released in March 2021, emphasized the need to strengthen government sway over private firms’ data—the first time a five-year plan has done so. A key element of Beijing’s push is a pair of laws, one passed in June 2021, the Data Security Law,  and the other a proposal updated by China’s legislature in Apr0il 2021. Together, they will subject almost all data-related activities to government oversight, including their collection, storage, use and transmission. The legislation builds on the 2017 Cybersecurity Law that started tightening control of data flows.

The law will “clearly implement a more stringent management system for data related to national security, the lifeline of the national economy, people’s livelihood and major public interests,” said a spokesman for the National People’s Congress, the legislature. The proposed Personal Information Protection Law, modeled on the European Union’s data-protection regulation, seeks to limit the types of data that private-sector firms can collect. Unlike the EU rules, the Chinese version lacks restrictions on government entities when it comes to gathering information on people’s call logs, contact lists, location and other data.

In late May 2021, citing concerns over user privacy, the Cyberspace Administration of China singled out 105 apps—including ByteDance’s video-sharing service Douyin and Microsoft Corp.’s Bing search engine and LinkedIn service—for excessively collecting and illegally accessing users’ personal information. The government gave the companies named 15 days to fix the problems or face legal consequences….

Beijing’s pressure on foreign firms to fall in line picked up with the 2017 Cybersecurity Law, which included a provision calling for companies to store their data on Chinese soil. That requirement, at least initially, was largely limited to companies deemed “critical infrastructure providers,” a loosely defined category that has included foreign banks and tech firms….Since 2021, Chinese regulators have formally made the data-localization requirement a prerequisite for foreign financial institutions trying to get a foothold in China. Citigroup Inc. and BlackRock Inc. are among the U.S. firms that have so far agreed to the rule and won licenses to start wholly-owned businesses in China…

Senior officials have publicly likened Tesla to a “catfish” rather than a “shark,” saying the company could uplift the auto sector the way working with Apple and Motorola Mobility LLC helped elevate China’s smartphone and telecommunications industries. To ensure Tesla doesn’t become a security risk, China’s Cyberspace Administration recently issued a draft rule that would forbid electric-car makers from transferring outside China any information collected from users on China’s roads and highways. It also restricted the use of Tesla cars by military personnel and staff of some state-owned companies amid concerns that the vehicles’ cameras could send information about government facilities to the U.S. In late May 2021, Tesla confirmed it had set up a data center in China and would domestically store data from cars it sold in the country. It said it joined other Chinese companies, including Alibaba and Baidu Inc., in the discussion of the draft rules arranged by the CyberSecurity Association of China, which reports to the Cyberspace Administration…

Increasingly, China’s president, Mr. Xi, leaned toward voices advocating greater digital control. He now labels big data as another essential element of China’s economy, on par with land, labor and capital.  “From the point of view of the state, anti-data monopoly must be strengthened,” said Li Lihui, a former president of state-owned Bank of China Ltd. and now a member of China’s legislature. He said he expects China to establish a “centralized and unified public database” to underpin its digital economy.

Excerpts from China’s New Power Play: More Control of Tech Companies’ Troves of Data, WSJ, June 12, 2021

Your Phone Is Listening: smart-phones as sniffers

U. S. government agencies from the military to law enforcement have been buying up mobile-phone data from the private sector to use in gathering intelligence, monitoring adversaries and apprehending criminals. Now, the U.S. Air Force is experimenting with the next step.

The Air Force Research Laboratory is testing a commercial software platform that taps mobile phones as a window onto usage of hundreds of millions of computers, routers, fitness trackers, modern automobiles and other networked devices, known collectively as the “Internet of Things.” SignalFrame, a Washington, D.C.-based wireless technology company, has developed the capability to tap software embedded on as many as five million cellphones to determine the real-world location and identity of more than half a billion peripheral devices. The company has been telling the military its product could contribute to digital intelligence efforts that weave classified and unclassified data using machine learning and artificial intelligence.

The Air Force’s research arm bought the pitch, and has awarded a $50,000 grant to SignalFrame as part of a research and development program to explore whether the data has potential military applications, according to documents reviewed by The Wall Street Journal. Under the program, the Air Force could provide additional funds should the technology prove useful.

SignalFrame has largely operated in the commercial space, but the documents reviewed by the Journal show the company has also been gunning for government business. A major investor is Razor’s Edge, a national-security-focused venture-capital firm. SignalFrame hired a former military officer to drum up business and featured its products at military exhibitions, including a “pitch day” sponsored by a technology incubator affiliated with U.S. Special Operations command in Tampa, Fla.

SignalFrame’s product can turn civilian smartphones into listening devices—also known as sniffers—that detect wireless signals from any device that happens to be nearby. The company, in its marketing materials, claims to be able to distinguish a Fitbit from a Tesla from a home-security device, recording when and where those devices appear in the physical world. Using the SignalFrame technology, “one device can walk into a bar and see all other devices in that place,” said one person who heard a pitch for the SignalFrame product at a marketing industry event…

“The capturing and tracking of unique identifiers related to mobile devices, wearables, connected cars—basically anything that has a Bluetooth radio in it—is one of the most significant emerging privacy issues,” said Alan Butler, the interim executive director and general counsel of the Electronic Privacy Information Center, a group that advocates for stronger privacy protections. “Increasingly these radios are embedded in many, many things we wear, use and buy,” Mr. Butler said, saying that consumers remain unaware that those devices are constantly broadcasting a fixed and unique identifier to any device in range.

Byron Tau,  Military Tests New Way of Tracking, WSJ, Nov. 28, 2020

Deforestation and Supply Chains

366 companies, worth $2.9 trillion, have committed to eliminating deforestation from their supply chains, according to the organization Supply Change. Groups such as the Tropical Forest Alliance 2020, the Consumer Goods Forum and Banking Environment Initiative aim to help them achieve these goals.  Around 70 percent of the world’s deforestation still occurs as a result of production of palm oil, soy, beef, cocoa and other agricultural commodities. These are complex supply chains.  A global company like Cargill, for example, sources tropical palm, soy and cocoa from almost 2,000 mills and silos, relying on hundreds of thousands of farmers. Also, many products are traded on spot markets, so supply chains can change on a daily basis. Such scale and complexity make it difficult for global corporations to trace individual suppliers and root out bad actors from supply chains.

Global Forest Watch (GFW), a WRI-convened partnership that uses satellites and algorithms to track tree cover loss in near-real time, is one example. Any individual with a cell phone and internet connection can now check if an area of forest as small as a soccer penalty box was cleared anywhere in the world since 2001. GFW is already working with companies like Mars, Unilever, Cargill and Mondelēz in order to assess deforestation risks in an area of land the size of Mexico.

Other companies are also employing technological advances to track and reduce deforestation. Walmart, Carrefour and McDonalds have been working together with their main beef suppliers to map forests around farms in the Amazon in order to identify risks and implement and monitor changes. Banco do Brasil and Rabobank are mapping the locations of their clients with a mobile-based application in order to comply with local legal requirements and corporate commitments. And Trase, a web tool, publicizes companies’ soy-sourcing areas by analyzing enormous amounts of available datasets, exposing the deforestation risks in those supply chains…

[C]ompanies need to incorporate the issue into their core business strategies by monitoring deforestation consistently – the same way they would track stock markets.

With those challenges in mind, WRI and a partnership of major traders, retailers, food processors, financial institutions and NGOs are building the go-to global decision-support system for monitoring and managing land-related sustainability performance, with a focus on deforestation commitments. Early partners include Bunge, Cargill, Walmart, Carrefour, Mars, Mondelēz, the Inter-American Investment Corporation, the Nature Conservancy, Rainforest Alliance and more.  Using the platform, a company will be able to plot the location of thousands of mills, farms or municipalities; access alerts and dashboards to track issues such as tree cover loss and fires occurring in those areas; and then take action. Similarly, a bank will be able to map the evolution of deforestation risk across its whole portfolio. This is information that investors are increasingly demanding.

Excerpt from Save the Forests? There’s Now an App for That, World Resources Institute, Jan. 18, 2017

The Internet: from Subversive to Submissive

Free-Speech advocates were aghast—and data-privacy campaigners were delighted—when the European Court of Justice (ECJ) embraced the idea of a digital “right to be forgotten” in May 2014. It ruled that search engines such as Google must not display links to “inadequate, irrelevant or no longer relevant” information about people if they request that they be removed, even if the information is correct and was published legally.

The uproar will be even louder should France’s highest administrative court, the Conseil d’État, soon decide against Google. The firm currently removes search results only for users in the European Union. But France’s data-protection authority, CNIL, says this is not enough: it wants Google to delete search links everywhere. Europe’s much-contested right to be forgotten would thus be given global reach. The court… may hand down a verdict by January.

The spread of the right to be forgotten is part of a wider trend towards the fragmentation of the internet. Courts and governments have embarked on what some call a “legal arms race” to impose a maze of national or regional rules, often conflicting, in the digital realm
The internet has always been something of a subversive undertaking. As a ubiquitous, cross-border commons, it often defies notions of state sovereignty. A country might decide to outlaw a certain kind of service—a porn site or digital currency, say—only to see it continue to operate from other, more tolerant jurisdictions.

As long as cyberspace was a sideshow, governments did not much care. But as it has penetrated every facet of life, they feel compelled to control it. The internet—and even more so cloud computing, ie, the storage of vast amounts of data and the supply of myriad services online—has become the world’s über-infrastructure. It is creating great riches: according to the Boston Consulting Group, the internet economy (e-commerce, online services and data networks, among other things) will make up 5.3% of GDP this year in G20 countries. But it also comes with costs beyond the erosion of sovereignty. These include such evils as copyright infringement, cybercrime, the invasion of privacy, hate speech, espionage—and perhaps cyberwar.

IIn response, governments are trying to impose their laws across the whole of cyberspace. The virtual and real worlds are not entirely separate. The term “cloud computing” is misleading: at its core are data centres the size of football fields which have to be based somewhere….

New laws often include clauses with extraterritorial reach. The EU’s General Data Protection Regulation will apply from 2018 to all personal information on European citizens, even if the company holding it is based abroad.

In many cases, laws seek to keep data within, or without, national borders. China has pioneered the blocking of internet addresses with its Great Firewall, but the practice has spread to the likes of Iran and Russia. Another approach is “data localisation” requirements, which mandate that certain types of digital information must be stored locally or remain in the country. A new law in Russia, for instance, requires that the personal information of Russian citizens is kept in national databases…Elsewhere, though, data-localisation polices are meant to protect citizens from snooping by foreign powers. Germany has particularly stringent data-protection laws which hamper attempts by the European Commission, the EU’s civil service, to reduce regulatory barriers to the free flow of data between member-states.

Fragmentation caused by government action would be less of a concern if other factors were not also pushing in the same direction–new technologies, such as firewalls and a separate “dark web”, which is only accessible using a special browser. Commercial interests, too, are a dividing force. Apple, Facebook, Google and other tech giants try to keep users in their own “walled gardens”. Many online firms “geo-block” their services, so that they cannot be used abroad….

Internet experts distinguish between governance “of” the internet (all of the underlying technical rules that make it tick) and regulation “on” the internet (how it is used and by whom). The former has produced a collection of “multi-stakeholder” organisations, the best-known of which are ICANN, which oversees the internet’s address system, and the Internet Engineering Task Force, which comes up with technical standards…..

Finding consensus on technical problems, where one solution often is clearly better than another, is easier than on legal and political matters. One useful concept might be “interoperability”: the internet is a network of networks that follow the same communication protocols, even if the structure of each may differ markedly.

Excerpts from Online governance: Lost in the splinternet, Economist, Nov. 5, 2016