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China Regulates Blockchain

China published new rules to request blockchain service providers to get the real name of each user and not to publish contents that do not conform to the authorities’ requirements.

The Cyberspace Admission Office issued the “Regulations on the Management of Blockchain Information Services” on January 10, 2019. The regulations will take effect on February 15, 2019.

The Regulations state that the blockchain service provider holds the main responsibility for the safety management of the contents, that it should implement a real ID identification system for its users, that it cannot use blockchain to conduct activities that are prohibited by law or by administrative regulations, and that it cannot produce, replicate, publish, or spread information prohibited by the law or by administrative regulations.

Source: Cyberspace Admission website, January 10, 2019
http://www.cac.gov.cn/2019-01/10/c_1123971138.htm

A Major Japanese Business Group Attacked by Chinese Hackers

The Asahi Shimbun, a Japanese national newspaper, reported that a Chinese group is suspected in the 2016 hacking of the computer system used by Keidanren, or the Japan Business Federation. Keidanren, a major Japanese business organization, consists of 1,281 companies, 129 industrial associations, and 47 regional economic organizations.

“The types of computer viruses used in the Keidanren attack as well as the external computer addresses to which information was secretly transmitted were very similar to those that turned up in a separate report” released in April 2017, compiled by the British defense company BAE Systems, the major consulting firm PwC, as well as the British National Cyber Security Center.

The Chinese hacking group is identified as Advanced Persistent Threat (APT) 10.

According to internal documents obtained by The Asahi Shimbun, in 2014, a Keidanren employee opened an email that had been sent to him with a virus. Consequently, malicious programs existed in communication systems and servers for two years, before an official announcement was made in November 2016 about the network break-in. The hackers could have read the information exchanged between Keidanren and the Japanese government, and then sent the information to overseas computers.

Keidanren’s computer system contained communications with government officials as well as a number of policy proposals.

While Tokyo is investigating this matter, in December, the Japanese Ministry of Foreign Affairs asked China to take measures against “APT 10.” China denied the allegation.

Source: Sputnik News, January 13, 3019
http://sputniknews.cn/china/201901131027343093/

Two Chinese Netizens Punished for Using VPN

China uses the Great Firewall to shield (its Netizens) from foreign websites. As a result, a large population of Chinese people use circumvention technologies to connect to the rest of the world. One of them is the Virtual Private Network (VPN), which extends a private network across a public network and enables users to send and receive data across shared or public networks as if their computing devices were directly connected to the private network.

On January 4, a resident in Shaoguan City, Guangdong Province, was charged with “creating and using illegal channels to connect to the  international network without authorization” and was fined 1,000 Yuan (US$ 148). A police “Administrative Penalty Decision” was spread online, showing that during the period from August to December 2018, the offender installed the Lantern Pro application on his mobile phone, connected to the broadband network at home to circumvent the Internet blockade, and logged on 487 times in the week before the punishment. Around the same time, another netizen in Chongqing received a notice form local police for the same charge.

Jyh An Lee, a professor at the Chinese University of Hong Kong, said this is the not first case of punishment. Since 2017, there have been a number of such stories.

According to Article 6 of the Interim Provisions on the Administration of International Network Management of the Computer Information Network of the People’s Republic of China (hereinafter referred to as the “Interim Provisions”), “To carry out international networking of computer information, the output and input channels that the Ministry of Posts and Telecommunications provides in its public telecommunication network shall be used. No unit or individual may establish or use other channels for international networking. The public security organ may give a warning to those who violate this regulation and impose a fine of up to 15,000 yuan.

On January 22, 2017, the Ministry of Industry and Information Technology issued a notice and decided to inspect the network infrastructure, network address, and broadband access network resources from the same day to March 31, 2018.

On July 1, 2017, GreenVPN, a brand name VPN service provider with a large number of users, stopped service. Later, more VPN service providers terminated their operations at the request of the regulatory authorities, including Tianhang VPN and Cloud Wall VPN. In 2017, Apple took down 674 VPN applications in the China Store app using the excuse that it was breaking Chinese law.

Lee said that the only legal channel to connect to overseas servers is through the three major telecom operators (China Mobile, China Unicom and China Telecom). Other forms of connection are illegal channels according to the “Interim Regulations.”

Lee added that the Chinese authorities used to technically block IP and it has now begun to enforce it legally.

According to conservative estimates, there are currently 20 to 30 million Chinese Internet users using VPN. Lee said that, for such a large population, the measures that the authorities take are selectively enforcement and depend upon the behavior’s impact on the government and the extent to which the government feels sensitive.

Source: BBC Chinese, January 10, 2019
https://www.bbc.com/zhongwen/simp/chinese-news-46823319

China Tightened Regulations for Online Short Video Platforms

On January 9, 2019, China Netcasting Services Association (CNSA), a government-led industrial association, issued regulations to cover online short video platforms.

According to The Paper, a mainland news portal, the regulations require the platforms to be proactive in introducing mainstream news media and institutions such as the communist party, the government, and military organizations. The purpose is to open accounts to “improve the supply of positive and quality short video contents.” The content layout is required to focus on promoting the “core values of socialism.”

It also requires that the short video platforms establish a system of editorial responsibility for the contents. All short video and audio broadcasts on the platforms “should be reviewed before broadcasting, including the title of the program, the introductory section, bullet screens, and comments.”

According to the regulation, the platform should “establish a team of auditors with high political quality and professional competence.” The provincial or higher level radio and television administrative authorities should train the auditors and the number of auditors should match the number of short video programs uploaded and streamed. In principle, the number of auditors should be more than one-thousandth of the daily number of new short video and audio broadcasts on the platforms.

Source: Central News Agency, January 9, 2019
https://www.cna.com.tw/news/acn/201901090316.aspx

Smart Uniforms and Technologies in Schools

The smart school uniform that Guizhou Guanyu Technology (贵州冠宇科技) developed was first launched in July 2017. According to its official website (http://www.guanyukj.com), ten elementary and middle schools have been using the smart school uniforms from the company. The schools are located in Guizhou, Fujian, Guangxi, and other provinces in China.

According to a Chinese media report, when the smart school uniform is put on, the school’s large screen monitor will automatically identify the student, display the student’s avatar, and record the accurate time of entering and exiting the school. The parents and teachers receive detailed information about the student’s activities. As soon as the student leaves the school, there is a voice broadcast to identify the student.

The smart school uniform, in combination with human facial recognition and fingerprint recognition technologies, will automatically calculate and settle a student’s different expenditures at school. The parents will know every item of their child’s expenditures in school.

This product is said to integrate big data, digitization of the Internet of Things (IoT), satellite technology, such as RFID, NFC, Beidou (the Chinese counterpart of GPS system), GPS, RS, and clothing.

The smart school uniform also comes with an app. In the app, the teacher can approve the student’s leave request and upload school notices and the time-stamped video of the students entering and leaving the school. Parent teachers can receive such information through the mobile app. Teachers can use the app to hand out course materials through voice, text, and pictures. The chip-embedded school uniform, with facial and fingerprint recognition, has established a closed-loop AI environment for the school. The students’ every move is in the hands of teachers and parents.

Qinjia (钦家), a Shanghai based company, also developed a smart school uniform, with the main function of preventing children from getting lost or being trafficked. Another company Seeworld launched another school uniform, mainly used when a student encounters an accident. The student can tap a specific part of the uniform to send out an S.O.S. signal.

In December 2015, the Beijing Municipal Education Commission set up a “Beijing Elementary and Middle School Uniform R&D Center” at the Beijing Institute of Fashion Technology. According to the official press release, the smart school uniforms will combine the motion sensor with the school uniform to track and analyze the student’s physical activity, analyze and compare the student’s physical functions and exercise volume, and ensure that the underage students receive proper physical exercises.

The People’s Daily also reported that a middle school in Hangzhou introduced an intelligent classroom behavior management system, which can monitor the students’ classroom behavior at a glance. The system can also analyze the students’ classroom behavior and the expressions during class and can also check attendance through facial recognition.

The smart school uniforms and similar technologies have received a lot of attention on cyberspace.

One netizen said, “Children have no human rights; they are just the possessions of their parents.”

Another put it this way, “A child is not a parent’s possession and the parents cannot completely control him. There is no longer any privacy.”

Source: Sina.com, December 24, 2018
https://t.cj.sina.com.cn/articles/view/6502104867/1838e3f2300100ywix

China Times: Primary iPhone Manufacturer Foxconn Setting Up Operations in Vietnam

Major Taiwanese newspaper China Times recently reported that, based on Vietnamese media reports, the primary Apple iPhone manufacturer Foxconn started a cooperative process with the City of Hanoi to establish its manufacturing operations in Vietnam. The move is reportedly in response to the on-going China-U.S. trade war. In fact, in October, the company’s subsidiary Foxconn Interconnect Technology had already completed a US$130 million acquisition of the Vietnamese company named New Wing Interconnect Technology, which is located in Bac Giang Province. Another possible reason for the Foxconn move could be the weakness of the new Apple iPhone sales trend, which has caused concern about reduced supply chain profits. Foxconn refused to validate this Vietnam move, citing its company policy of not commenting on matters directly related to its clients.

Source: China Times, December 4, 2018
https://www.chinatimes.com/cn/newspapers/20181204000393-260204