Hong Kong (CNN) China has expanded the scope of its already sweeping counterintelligence law in a move that analysts warn could create further legal risk or uncertainty for foreign companies, journalists and academics.
The amendments expand the definition of espionage from covering state secrets and intelligence agencies to include any “documents, data, materials or items relating to national security and interests” without specifying specific parameters for defining these terms.
Cyber attacks on China’s central information infrastructure related to espionage agencies are also classified as espionage under the new law, which goes into effect on July 1.
The change, approved by China’s top legislature on Wednesday, comes amid a rising emphasis on national security under Chinese leader Xi Jinping, the country’s most assertive leader in a generation.
Xi has overseen a series of new measures to counter perceived threats inside and outside China and sought to control the flow of information outside the country during his 10-year tenure.
The original version of the law, passed in 2014, was already “very ambiguous and very powerful,” said Yasuhiro Matsuda, a professor of international relations at the University of Tokyo. “But China thinks it’s not enough,” he said.
The expanded counterintelligence law comes just months after China lifted its pandemic-era border restrictions after three years of self-imposed Covid isolation — measures that had kept most foreign businessmen and researchers out.
“China is opening up and that makes it much more vulnerable in the eyes of Chinese leaders,” Matsuda said.
The revision is likely to increase concerns of foreign individuals, such as academic researchers or journalists, and businesses about visiting or doing business in China.
The new language in the amendment suggests that “any organization and anyone can be suspected … and anything can be considered a threat to national security,” Matsuda said. “It’s definitely going to have a chilling effect,” he said.
Increased risks
The lack of clarity about what type of documents, data or materials might be considered relevant to national security will pose major legal risks for academics and companies trying to better understand China.
According to analysts, topics such as the origin of Covid, China’s actual death toll in a pandemic and authentic data on the Chinese economy could all fall within the law’s crosshairs.
“Before (some activities) were normal employment, but now they could be espionage,” said Alfred Wu, associate professor at the Lee Kuan Yew School of Public Policy at the National University of Singapore.
“Something like a local government budget, which you could roughly define as related to national security or even food security,” he said. “Researchers definitely have to be careful.”
China says its national security and espionage laws are designed to protect the country.
Concerns about the application of the law have been compounded by a series of arrests of foreign nationals on espionage charges in recent years.
Foreign governments have described the cases as politically motivated and have accused Beijing of violating due process, such as denying access to lawyers and holding trials in camera.
In a high-profile example, two Canadians – former diplomat Michael Kovrig and businessman Michael Spavor – have been held by China for nearly three years.
Her arrest on espionage charges in late 2018 came shortly after Canada arrested Chinese businesswoman and Huawei executive Meng Wanzhou on a US warrant related to the company’s operations in Iran.
Beijing has repeatedly denied that their cases were political retaliation, but the two men were released the same day Meng was allowed by Canada to return to China.
companies on the fringes
In recent weeks, Japan has called for the release of one of its nationals employed by Astellas Pharma, who was arrested last month on charges of espionage in China.
According to Japanese state broadcaster NHK, at least 17 Japanese nationals have been arrested since 2015 on suspicion of espionage and other activities in China.
These circumstances have already affected personnel traveling to China from Japan, according to Kawashima Shin, a professor of international relations at the University of Tokyo.
“It’s so difficult — so many Japanese scholars have already decided not to go to China,” Kawashima said.
Japanese companies also note that the legal definition of espionage is “vague,” making them “reluctant to send businessmen to China,” he said. “That is a big problem.”
One problem is that in previous detentions, the details of the court procedures have not been open, making it difficult for companies or individuals to make risk assessments and assess at what point an activity may be crossing a legal boundary, Kawashima said.
“Even with this change, we still don’t understand what type of document poses a national security issue,” he added. “China can decide on a case-by-case basis.”
Western companies are also nervous.
Last month, Chinese authorities closed the Beijing office of Mintz Group, an American corporate due diligence firm, and arrested five local employees. And on Thursday, US consulting firm Bain & Company said Chinese police were questioning employees at its Shanghai office.
Chinese authorities did not provide details on either case, including the reason for the action, but analysts say the move is likely to further scare foreign companies operating in China.
“The Chinese government has consistently said it welcomes foreign investment. However, a recent spate of action taken against US companies in China has signaled the opposite,” said Michael Hart, President of AmCham China.
“Our business community is terrified and our members are asking, ‘Who’s next?’ Regardless of the government’s intention, this is the message that will be received.”
CNN’s Michelle Toh contributed to the coverage.