House Intel Committee Witnesses Target Chinese Cyber, IP Threats

The House Intelligence Committee today heard testimony from several witnesses who warned that China is actively working to infringe upon the intellectual property rights of U.S. entities, engages in cyberespionage against the United States, and poses a growing cyberthreat to the country.

However, China wasn’t the only foreign cyber adversary discussed at today’s hearing.

During his opening statement, Rep. Adam Schiff, D-Calif., ranking member of the committee, made a motion to subpoena the interpreter used during President Trump’s recent meeting with Russian President Vladimir Putin in Helsinki. After a brief Robert’s Rules of Order-style back and forth with committee Chairman Devin Nunes, R-Calif., the hearing was put into recess and Schiff’s motion was voted down.

After the hearing returned to its original topic, both legislators and witnesses dug into the threats China poses to the United States and how the Federal government can combat those threats and protect U.S. interests.

Among those topics was a proposed ban on Federal government purchases of goods and services from China-based communications equipment makers ZTE and Huawei, which as of press time was still included in FY2019 National Defense Authorization Act bills in the House and Senate.  A bipartisan group of legislators favors the ban, but the White House remains opposed. While Chairman Nunes did not mention the ban in his opening statement, witnesses were quick to bring it up.

“This is clearly a bipartisan national security matter,” said Michael Pillsbury, director of The Center On Chinese Strategy at the Hudson Institute, a politically conservative think tank. “The four senators who last month opposed President Trump on the ZTE issue included both Chuck Schumer, D-N.Y., and Chris Van Hollen, D-Md.”

And witnesses suggested a number of steps the United States could take to deal with Chinese IP and cybersecurity threats.

Elsa B. Kania, adjunct fellow, Technology and National Security, at the Center for a New American Security, offered numerous countermeasures, including:

  • “Enhance and enforce cyber security standards and requirements for contractors and laboratories engaged in sensitive academic research;
  • Review recent and existing research and commercial partnerships on strategic technologies that involve support and funding from foreign militaries, governments or state-owned/supported enterprises, evaluating the dual-use risks and potential externalities in each case;
  • Enhance counterintelligence capabilities, particularly by augmenting language and technical expertise, to focus on enforcement; and
  • Improve visa screening of foreign nationals who plan to study or research sensitive or strategic technologies, targeting scrutiny on the basis of whether or not students or researchers have direct and clear connections to foreign militaries, governments or intelligence services.”

Michael Brown, now a Presidential Innovation Fellow and a former CEO of Symantec, stressed that China has been engaging in technology transfer, through both legal and illegal means, for decades. In order to counter such transfers and maintain innovation leadership, Brown suggested the United States take four steps:

  • First, implement better defensive tools, including Committee on Foreign Investment in the United States (CFIUS) reforms included in the Foreign Risk Review Modernization Act of 2017, as well as expanded and updated export control reforms.
  • Second, implement harsh sanctions against Chinese firms that steal U.S. IP, and change U.S. law so that Chinese firms can be sued in U.S. courts
  • Third, increase investment in FBI counterintelligence efforts with a focus on preventing IP theft rather than prosecuting cases; and
  • Finally, come up with a long-term “game plan to be successful in the technology race we now find ourselves in with China,” he said.

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