U.S.–China Week: A ‘FON’ op. or not? Cybersecurity Law in effect, Mattis at Shangri-La: ‘Bear with us.’ (2017.06.05)

Welcome to Issue 101 of U.S.–China Week. This edition covers three weeks of news, so it is far from thorough, but significant South China Sea and cyberspace policy developments deserve attention. We’re back to a broader agenda next Monday.

As always: Please encourage friends and colleagues to subscribe to U.S.–China Week. Here is the web version of this issue, ideal for sharing on social media, and you can follow me on Twitter at @gwbstr. Please send your comments, quibbles, and suggestions to [email protected].

SOUTH CHINA SEA
U.S. destroyer in possible ‘FON’ op. at Mischief Reef; PLA jet in close intercept of U.S. spy plane; ‘Code of Conduct’ moves

A U.S. Navy guided missile destroyer, USS Dewey, reportedly navigated within 6 nautical miles (nm) of the Chinese outpost constructed atop Mischief Reef in the South China Sea’s Spratly Islands on May 25 local time. USNI News had the most detail, saying the Dewey spent 90 minutes within 12nm of Mischief, where it zig-zagged and conducted a man overboard drill. A Pentagon statement sent to journalists but not published would not confirm details of the operation, but said “We are continuing regular FONOPS [Freedom of Navigation (FON) operations], as we have routinely done in the past and will continue to do in the future. Summaries of these operations will be released publicly in the annual FONOPS report, and not sooner.”

Most reporters and analysts said the Dewey maneuver was a FON operation, but it’s not clear it was officially so. As I argued last year at Lawfare, a U.S. military sail-by at Mischief Reef does not easily fit into existing patterns in the FON program, because China has carefully avoided making formal claims of maritime rights or jurisdiction surrounding its installation there and FON operations are designed to challenge “excessive maritime claims.” Official Chinese responses to the Dewey’s activities continued to avoid assertions about legally significant terms such as “territorial sea,” but a Foreign Ministry spokesperson did note that the U.S. ship did not have permission to be in the area.

Meanwhile: U.S. sources told media a Chinese fighter jet performed an unsafe intercept of a U.S. spy plane over the South China Sea; it wasn’t clear in reports whether this followed or preceded the Dewey voyage. / Chinese officials said they were “strongly dissatisfied” with mention of the East and South China Seas in a G7 statement. / China and ASEAN governments reportedly had a “framework” brewing for South China Sea Code of Conduct negotiations, with a Singaporean official saying a “draft” framework would be submitted to the China-ASEAN foreign ministers’ meeting in August.

ANALYSIS: Though China’s government has not formally claimed a territorial sea surrounding Mischief, the Dewey’s action appeared designed to express the U.S. view that, under the UN Convention on the Law of the Sea (UNCLOS) and according to the tribunal in the Philippines v. China arbitration, there could be no territorial sea surrounding an outpost constructed atop the low-tide elevation at Mischief. In the annual FON reports since 1991, there is no example of the U.S. government using the FON program for this purpose. On the other hand, Vice President Mike Pence told graduating cadets at the Naval Academy “just yesterday one of our mighty ships conducted freedom of navigation operations.” Whether a formal FON operation or not, it is likely that news of the operation, preceding the Shangri-La Dialogue in Singapore, did not emerge entirely by accident.

CYBERSPACE + TECH
China’s Cybersecurity Law goes into effect amid uncertainty and with implementation partially delayed

Before the Cybersecurity Law was to go into effect June 1, the Cyberspace Administration of China (CAC) held a meeting with “around 100” participants including from the international technology industry. At the meeting, CAC presented a revised draft of regulations on transferring “personal information and important data” out of China that has not been formally published but has circulated among analysts and reporters. Most significantly, the revised measures said adherence to the rules starting December 31, 2018, rather than this month, giving businesses time and giving regulators room to adjust the rules. Also in the lead-up to June 1, the Chinese standards-setting body Technical Committee 260 (TC260) issued draft guidelines for cross-border data flows that add significant detail to what Chinese regulators are likely to treat as “important data” (重要数据), a crucial term in defining what data are subject to limits on cross-border transfers in the Cybersecurity Law. Detailed definitions of “critical information infrastructure” (关键信息基础设施), however, are still in question. TC260 has also released numerous sector-specific draft standards, some of which might be made binding through reference in further regulations that will implement the law.

ANALYSIS: As I told AFP, the law is part of an evolving regulatory regime for cyberspace and the digital economy that does not switch on like a light with the June 1 implementation date. That regime will continue to develop through a network of related regulations, evidence about implementation, and interaction with the changing regulatory environment in other jurisdictions. At Lawfare, Samm Sacks has a the best single explanation of the significance and role of the Cybersecurity Law to date.

U.S.–CHINA TECH ROUNDUP

  • Microsoft issues Windows 10 edition customized for Chinese government. Microsoft release | WSJ story
  • Google’s AlphaGo AI beats top Chinese human go player, as event streaming blocked in China. FT story
  • U.S. Director of National Intelligence Dan Coats: private sector says “cyber activity from China…significantly lower than before the bilateral Chinese-U.S. cyber commitments of September 2015.”
  • “Big data, Chinese surveillance, and Donald Trump could keep China’s biggest payments company from entering the US” Quartz story on Ant Financial’s effort to buy MoneyGram
  • Kunlun Tech, a Beijing-based game company, buys remainder of dating app Grindr after purchasing controlling stake in January. Caixin story
  • China’s government is increasing funding for AI projects while the United States and Europe stagnate or reduce support, NYT reported.
  • Elsa Kania on “China’s Employment of Unmanned Systems: Across the Spectrum from Peacetime to Wartime” at Lawfare
  • Flashpoint: “Linguistic Analysis of WannaCry Ransomware Messages Suggests Chinese-Speaking Authors
  • “Chinese state media says U.S. should take some blame for cyber attack” Reuters story
  • “Symantec Says ‘Highly Likely’ North Korean Hacking Group Behind Ransomware Attack” Reuters story
  • Overseas users of Sina Weibo blocked from posting pictures or video on June 4 Tiananmen anniversary. SCMP story

SUMMIT CIRCUIT
China skips big speech at Shangri-La, cancels Xiangshan; Mattis pushes ‘rules-based order,’ says ‘bear with us’

At the annual Shangri-La Dialogue defense gathering in Singapore, China “sent a lower-ranking delegation … and, in a stark contrast to previous events, none of its members” was to give a keynote speech, SCMP reported. After Shangri-La, SCMPreported China’s government would also cancel its similar meeting, the Xiangshan Forum, at least for this year.

Secretary of Defense James Mattis did give a keynote speech at Shangri-La, one that included a lengthy section on U.S.–China ties amidst an emphasis on the “rules-based order.” Chinese officials reacted negatively to Mattis’ comments on the East and South China Sea. His comments on the topic were fairly direct:

“The 2016 ruling by the Permanent Court of Arbitration on the case brought by the Philippines on the South China Sea is binding. We call on all claimants to use this as a starting point to peacefully manage their disputes in the South China Sea. Artificial island construction and indisputable militarization of facilities on features in international waters undermine regional stability. The scope and effect of China’s construction activities in the South China Sea differ from those in other countries in several key ways. This includes the nature of its militarization, China’s disregard for international law, its contempt for other nations’ interests, and its efforts to dismiss non-adversarial resolution of issues. We oppose countries militarizing artificial islands and enforcing excessive maritime claims unsupported by international law. We cannot and will not accept unilateral coercive changes to the status quo.”

Mattis also spoke of providing arms to Taiwan but emphasized the One China policy in Q&A. Also in Q&A, Mattis left the impression he’s not entirely satisfied with the administration’s efforts to date: “To quote a British observer of us from some years ago, ‘Bear with us. Once we’ve exhausted all possible alternatives, the Americans will do the right thing.'”

#USChinaWeek1967
‘U.S. Warns China on Vietnam War: Official Asserts Washington Would Meet Intervention With Everything It Has’

“WASHINGTON, May 23[, 1967]—A State Department official declared today that if Communist China were to intervene with massive forces in Vietnam, the United States would have to take action against mainland China with everything it has. Although officials acknowledged that the warning was slightly ambiguous, the State Department said it was intended to refer only to the use of conventional American weapons rather than nuclear weapons. State Department officials added, however, that they considered a major Chinese intervention in Vietnam very unlikely. They said there were no signs in Peking’s recent propaganda or other activity pointing toward a major Chinese intervention. The question came up during a briefing at the State Department for newspaper editors and broadcasters. Under the rules of the briefing, the official who made the statement could not be identified…”

(Source: The New York TimesThis entry is part of an ongoing feature of U.S.–China Week that follows U.S.–China relations as they developed in another era of change and uncertainty, 50 years ago.)

ABOUT U.S.–CHINA WEEK

U.S.–China Week is a weekly news and analysis brief that covers important developments in U.S.–China relations and features especially insightful or influential new policy analysis.

Graham Webster is a senior research scholar, lecturer, and senior fellow of the Paul Tsai China Center at Yale Law School, where he specializes in U.S.–China diplomatic, security, and economic relations through research and Track II dialogues. He is also a fellow for China and East Asia with the EastWest Institute. His website is gwbstr.com.

Disclaimer: Opinions expressed here are my own (and I reserve the right to change my mind).

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Contact: Follow me on Twitter at @gwbstr. Send e-mail to [email protected].