VPN in China

The main articles are:

• VPN and privacy (anonymity, anonymizers)
• Censorship (control) on the Internet. China experience

2023: A programmer in China was fined $145 thousand for using a VPN to bypass the "Great Chinese Firewall"

On August 18, 2023, the public security bureau of Chengde in the Chinese province of Hebei imposed a fine on a local programmer in the amount of more than 1 million yuan for using a VPN. This is one of the most severe personal monetary penalties for trying to bypass the "Great Chinese Firewall."

The official notification of the authorities says that a developer named Ma (Ma) used "unauthorized channels" to connect to international networks in connection with his work in a Turkish company. Law enforcement agencies seized Ma's financial assets in the amount of 1.058 million yuan (approximately $145 thousand at the exchange rate as of October 10, 2023), which he earned from September 2019 to November 2022 as a programmer, qualifying these funds as "illegal income."

Chengde City Public Security Bureau fines programmer more than 1 million yuan for using VPN

According to Ma, law enforcement officials first contacted him in 2022, believing that he was the owner of a Twitter account (X - after rebranding), which appeared in some kind of proceedings. In fact, this account does not belong to the programmer. However, after learning that Ma works for a foreign company, the police confiscated his smartphone, laptop and several drives for a month. Later, the programmer was required to provide detailed information about his work, bank details, an employment contract and other information. As a result, Ma was fined a large fine for using a VPN.

In China, VPN services are located in the "gray" legal zone. Technically, companies are allowed to use government-approved VPN funds for commercial activities. In particular, enterprises and universities rely on such tools when interacting with international partners. However, as of 2023, the Chinese authorities are complicating Internet users' access to VPNs and in some cases resort to penalties.^[1]

2018: China's official VPN ban

On March 31, 2018, an official ban on the use of virtual private networks (VPNs) came into force in China. Companies and consumers in the country will not be able to use such services that are not approved by the government.

True, as Reuters notes, regulators have not provided clear explanations of how this ban was implemented. In particular, it is unclear whether legal entities and individuals will be punished for using unauthorized VPN products or whether such software will simply be blocked.

Companies interviewed by the news agency say that they have not received directives from the authorities to ban VPNs, and the lack of transparency of the new rules is of concern to businesses.

VPN officially banned in China

We do not expect instant influence, but there is no clarity, and this is not good. We have products that have been banned or revised under similar laws in the past. We are very confident that there will still be discussions before careless steps are taken, "the head of one of the American IT companies, who wished to remain anonymous, told the publication.

In January 2018, the head of the Chinese Policy Committee of the US Chamber   of Commerce, Lester Ross, told reporters that restricting VPNs in the Celestial Empire would hurt small companies that would be forced to pay for expensive international leased telephone lines (IPLC; will be provided by three Chinese operators) to overcome harsh internet censorship in China. Many foreign corporations have their own VPN servers located outside of China, which cannot be said about small businesses.

According to foreign diplomats cited by Reuters, the PRC authorities are unwilling to discuss rules for cyberspace, and a VPN ban could damage China's reputation and international relations, as well as undermine the country's competitiveness.

The Ministry of Industry and Information Technology of the People's Republic of China (China's Ministry of Industry   and Information Technology) did not give detailed comments on the requests of the Western media and only noted that the use of state-approved VPN services would not jeopardize the security of private data, because "the authorities cannot see information related to your business."

A member of the Chinese anti-censorship group GreatFire.org, which monitors Internet restrictions, said the new rules are aimed at destroying Chinese providers of low-cost VPN services and increasing control over access to information.

Samm Sacks, who researches Chinese technology policy at the US Center for Strategic and International Studies, believes that China is likely to be lenient towards most foreign organizations.

We will probably see selective enforcement. Until now, few foreign companies have encountered problems working with their VPN networks. It just adds another layer of uncertainty amid how foreign companies are already facing various challenges doing business in China, Sacks noted.

A survey of companies conducted by the European Chamber of Commerce showed that even before the ban on unofficial virtual private networks was imposed, many business representatives complained about the slow and unstable Internet in China. Some of them estimated the damage from poor Internet access at more than 20% of annual revenue. With VPN restriction, the situation may get worse.^[2]

2017

The creator of the VPN network, who sold access to it, was sentenced to 5.5 years in prison

China A resident has been sentenced to 5.5 years in prison for illegally setting VPN up a network and selling access to it. The verdict was passed by the court of Guangxi Zhuang Autonomous Region of the PRC. The local prosecutor's office managed to prove that Wu Xiangyang set up a virtual private network in 2013, which allowed him to bypass the existing China Internet censorship (in the West, the name "Great" - Firewall"Great Firewall" was assigned to it) and freely visit any foreign resources^[3]

Having decided to earn extra money on his talent, Wu Xianyang began selling access to VPN accounts first to his acquaintances, and then to strangers. But the basis of the clientele was foreigners living in China, who often need access to Western sites for work. For four years, an enterprising Chinese managed to earn 500 thousand yuan - more than $75 thousand. For this amount, the state fined him, in addition to the prison term. The investigation established that by the time of the capture in June of this year, Wu served about 8 thousand foreign citizens and about 5 thousand companies stationed in China.

VPN seller sentenced to 9 months in prison

In September 2017, it became known about the verdict of 26-year-old Chinese Deng Jiewei, who distributed software to bypass site locks. The Supreme People's Court of the PRC sentenced Jiwei to nine months in prison for "illegal control of computer systems."

Chinese man gets 9 months in prison for selling software to bypass site locks

The young man was charged under section 285 of the Chinese penal code, which states the following:

Anyone who violates Chinese law and invades computer information systems related to government affairs, the construction of defense facilities and high-tech industries of science and technology is sentenced to more than three years in prison.

Deng Jiwei was arrested in October 2016. Interestingly, he was sentenced back in March 2017, but information about this got to the press only a few months later.

According to court documents, Deng Jiwi, together with his partner Jiang Zhifeng, created a yingsuoyun.com website through which VPN software was sold, which allowed bypassing Internet censorship in China and using prohibited foreign sites such as Facebook and Youtube. The total profit of the authors of the project is estimated at 14 thousand yuan (about $2125).

Jiang Zhifeng managed to escape from law enforcement. He is wanted. After the verdict, the resource yingsuoyun.com began to redirect to the court decision.

The verdict on VPN software sellers is one of the first of its kind. The reaction of Chinese users on social media was negative. Someone wondered why VPN services are considered a way to "invade and illegally control" computer systems, others began to express concern that the use of bypass blocking technologies would now be strictly monitored and punished by the authorities.^[4]

VPN access in China will be closed from February 1, 2018

In July, the Chinese government ordered all telecom providers in the country to block users from accessing virtual private networks (VPNs). The order must be carried out by February 1, 2018, writes Bloomberg, citing anonymous sources. It concerns, first of all, three state telecom companies - China Mobile, China Unicom and China Telecom (China Telecom).^[5]

After that, Chinese users will not be able to visit foreign resources blocked in China via VPN. Currently, VPNs are used in the country as a loophole in the "Great Chinese Firewall" - a system for blocking foreign sites, ranging from social networks like Twitter and Facebook to news publications like the New York Times.

At least one Chinese VPN service has already fulfilled the requirement of the authorities, writes Bloomberg. GreenVPN informed its customers a few days ago that it was ceasing service due to receipt of notification from regulatory authorities. What exactly was said in the notification, GreenVPN does not disclose.

It is not yet clear how the new directive will affect multinational ICT companies operating in China. However, the problem can affect not only the ICT sector, but also business in general.

"VPNs are very important for companies that need access to global services outside of China. In the past, any attempt to cut off an internal corporate VPN was enough for the company to consider closing its Chinese office or restricting its operations in China. This is such a big problem, "said Jay Parker, vice president of the US-China Business Council in Beijing

In China, limited the possibility of using VPN

In January 2017, the PRC Government announced the launch of a campaign to "cleanse" the country of "illegal Internet connections." In practice, this means a ban on the operation of virtual private networks (VPNs), if they are not granted permission from local authorities.^[6]

The Great Chinese Firewall is a server system on an Internet channel between providers and international information networks that filters information.

To bypass the bans, citizens China began to actively use - VPN services. After that, the Ministry of Information and Technology of China announced that all VPN services should receive a license from regulators. This automatically means that now most companies providing services for the provision of virtual private networks have become illegal.

In addition to VPN providers, the authorities want to force content distribution companies, as well as any data centers, to obtain licenses.

This is not the first such campaign. The previous one took place in March 2016; then VPN providers in China did not work for several weeks.^[7]

Western media note that the new requirements for VPN and cable providers look blurred, and most likely this was done purposefully. It is not yet clear how the government is going to put these rules into practice and ensure their implementation.

It is worth saying that just a week earlier, Chinese leader Xi Jinping made a statement that clearly contradicts the actual actions of the country's authorities:

We must redouble efforts to develop global communications so that all countries can achieve interconnected growth and shared prosperity... Striving for protectionism is like locking yourself in a dark room. Let the wind and rain remain outside, but neither light nor air will penetrate inside.

Notes