From: The Honorable Rick Larsen
Sent By:
terra.sabag@mail.house.gov

Date: 3/9/2017

Deadline COB Today

 

Current Cosigners: LaHood,
Larsen, Lance, Graves, DelBene, Comstock, Connolly,
Kind

Dear Colleague:

 

Join us in sending a letter to the Chinese Ambassador to the United States expressing concerns over steps the Chinese government is taking to restrict U.S. cloud service providers from providing services in China. Currently China has two draft notices that
would essentially require the transfer of all cloud ownership and operations to a Chinese partner.

 

This is troubling and could stifle business. We would like to urge the Chinese government not to implement these draft regulations because we are confident that our companies can address China’s legitimate concerns over privacy and national security without
reliance on current and proposed cloud regulations and want to work with the Chinese government.

 

If you would like to join us in sending this letter, please reach out to Ashley Antoskiewicz of Congressman LaHood’s office at
Ashley.Antoskiewicz@mail.house.govor Terra Sabag of Congressman Larsen’s office at
terra.sabag@mail.house.gov. Deadline COB today.

 

/s                                                                                                                            /s

Congressman Darin LaHood                                                                           Congressman Rick Larsen

Member of Congress                                                                                     Member of Congress

 

 

We write to express our significant and growing concern over steps your government has taken and might take additionally to restrict U.S. cloud service providers (CSPs) from providing services in China. U.S. CSPs help entrepreneurs and innovators around
the world apply their imagination and energy to grow their businesses, expand their research capabilities, and reach new audiences all in a cost effective, reliable, and secure environment.  Further, cloud services allow businesses to compete globally, which
is why more companies are moving to the cloud.

 

Recently, the Ministry of Industry and Information Technology (MIIT) in China has proposed two draft notices –
Regulating Business Operation in Cloud Services Market (2016) and Cleaning up and Regulating the Internet Access Service Market(2017). These measures, together with existing licensing and foreign direct investment restrictions on foreign CSPs
operating in China under the Classification Catalogue of Telecommunications Services (2015) and the
Cybersecurity Law (2016), would require foreign CSPs to turn over essentially
allownership and operations to a Chinese partner, forcing the transfer of valuable U.S. intellectual property to a Chinese partner and effectively barring foreign CSPs from operating or competing fairly in China.

 

More specifically, these measures prohibit licensing foreign CSPs for operations; actively restrict direct foreign equity participation of foreign CSPs in Chinese companies; prohibit foreign CSPs from signing contracts directly with Chinese customers; prohibit
foreign CSPs from independently using their brands and logos to market their services; prohibit foreign CSPs from contracting with Chinese telecommunication carriers for Internet connectivity; restrict foreign CSPs from broadcasting IP addresses within China;
prohibit foreign CSPs from providing customer support to Chinese customers; and, require any cooperation between foreign CSPs and Chinese companies be disclosed in detail to regulators.  As we see it, these restrictions are fundamentally protectionist and
anti-competitive.  We also note that Chinese cloud computing companies do not face any of the above-listed restrictions in the United States and in fact are already operating here.

 

We are confident that our companies can address China’s legitimate concerns over privacy and national security without reliance on current and proposed cloud regulations.  We urge China to rethink implementation of the MIIT draft notices and to revise the
Classification Catalogue of Telecommunications Services (2015)and the
Cybersecurity Law (2016)
to remove licensing and direct investment restrictions on foreign CSPs operating in China.

 

We appreciate your continued friendship and engagement and look forward to working with you on this issue.