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3/26/2013
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Congress Curtails Government IT Purchases From China

Continuing resolution bars some government agencies from buying IT equipment from Chinese-owned or -subsidized companies without FBI or other approval.

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The continuing resolution funding the federal government through the end of September, which is now sitting on the President's desk and ready for his signature, bars government purchases of IT equipment produced by Chinese government-owned or -subsidized companies without prior consultation with the FBI.

The bill reflects continued and rising concerns about Chinese hacking and other risks of Chinese technology. The Obama Administration recently has picked up rhetoric about Chinese hacking as reports continue to pour in about the Chinese government's connection to cyber espionage.

Specifically, the bill prohibits a short list of specific government agencies, including the Departments of Commerce and Justice, NASA and the National Science Foundation, from using funds made available as part of the continuing resolution to buy any IT unless the FBI "or other appropriate federal entity" has assessed the risk of "cyber-espionage or sabotage" that derives from the equipment being produced in connection with the Chinese government.

[ Should your company worry about Chinese hacking? Read China Hack Attacks: Play Offense Or Defense? ]

In addition, the law prohibits those agencies from using funds to buy IT systems produced, manufactured or assembled by companies or other entities owned, directed or subsidized by the Chinese government unless the head of the FBI or whatever agency is doing the assessment has both determined and reported to Congress that the acquisition is "in the national interest of the United States."

The provision could affect government purchases of technology from Chinese companies such as Huawei, ZTE and Lenovo. The House Intelligence Committee last year warned in a report about national security threats posed by Huawei and ZTE. However, the bill could also affect components built by smaller Chinese companies.

It's unclear from the text of the provision why the White House asked these particular agencies to be cautious. Other big users of IT include the Department of Defense, Department of Homeland Security, General Services Administration, Department of Health and Human Services, and Department of Energy, among others.

If it is signed, the bill wouldn't even represent the first time Congress has made its opinion known about U.S. government IT operations vis-à-vis China in the last two weeks. Last Monday, Rep. Frank Wolf, R-Va., announced that a contractor who had been working at NASA Langley was arrested with what federal agents believe to be sensitive government information. During a press conference announcing the arrest, Wolf urged NASA to temporarily shut down online sources of technical data to remove controlled documents from widely available systems.

Other tech-related provisions in the continuing resolution include specific funding and attached requirements for the Department of Homeland Security's National Protection and Programs Directorate; requirements that any tech bought under the law block pornography; funding for Department of Agriculture IT; and requirements that the CIO of USDA approve significant IT spending.

A well-defended perimeter is only half the battle in securing the government's IT environments. Agencies must also protect their most valuable data. Also in the new, all-digital Secure The Data Center issue of InformationWeek Government: The White House's gun control efforts are at risk of failure because the Bureau of Alcohol, Tobacco, Firearms and Explosives' outdated Firearms Tracing System is in need of an upgrade. (Free registration required.)

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Andrew Hornback
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Andrew Hornback,
User Rank: Apprentice
4/3/2013 | 2:59:04 AM
re: Congress Curtails Government IT Purchases From China
This kind of begs the question - is there anyone else, aside from the small/boutique hardware manufacturers, that produces systems in the United States from components sourced in the United States?

Crack open most any desktop or laptop made these days and you're more likely to see a "Made in China" label... and when it comes to mobile devices, more than simply more likely.

Andrew Hornback
InformationWeek Contributor
Deirdre Blake
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Deirdre Blake,
User Rank: Apprentice
3/27/2013 | 3:51:35 PM
re: Congress Curtails Government IT Purchases From China
Unfortunately, most contracting companies are so globalized that this move seems like it would be difficult/impossible to enforce; and by limiting the regulations to only specific agencies, it lacks any real teeth. Still, I suppose it sends a message to Chinese authorities that the folks in Washington are losing patience and cyber-espionage is going to start carrying a financial penalty.
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