Hacking private companies for commercial gain, on the other hand, was not. According to the administration’s definition, hacking for national security purposes was to be expected by all states and was fair game. The announcement suggested that Washington had successfully defined a norm of state behavior in cyberspace, distinguishing between acceptable and unacceptable hacking. Washington called out specific acts of malfeasance in order to deter future hacks, and indicted the perpetrators when it could identify them. Thus the announcement of the cyber pact appeared to be the result of a diplomatic and legal strategy referred to as naming and shaming. Standing on the steps of the Rose Garden in September 2015, Obama and Xi vowed that neither the United States nor China “will conduct or knowingly support cyber-enabled theft of intellectual property, including trade secrets or other confidential business information,” for commercial advantage.
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These punishments would have overshadowed President Xi’s first summit in Washington, and in response, Beijing dispatched Meng Jianzhu, one of the Chinese Communist Party’s highest-ranking officials, to negotiate an agreement. In the summer of 2015, news reports suggested that the administration was ready to use Executive Order 13694, which authorizes sanctions against companies or individuals that profit from cyber theft, to sanction state-owned enterprises and senior Chinese officials associated with cyber theft.
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In May 2014, the Department of Justice indicted five People’s Liberation Army (PLA) officers for stealing trade secrets from Westinghouse, U.S. President Barack Obama confronted Chinese President Xi Jinping with the issue at the Sunnylands Summit. In a speech at the Asia Society in early 2013, National Security Advisor Thomas Donilon warned of “cyber intrusions emanating from China on an unprecedented scale.” Months later, U.S. economy from the theft of intellectual property to be more than $300 billion, with 50 to 80 percent of such theft by China. competitiveness, an independent commission estimated the annual loss to the U.S. Although it is hard to measure the effect of cyber espionage on U.S. Many of the targeted companies operated in sectors that Beijing believes are important for future innovation, such as aerospace, semiconductors, and information technology. Backgroundįor years, Chinese hackers carried out a massive campaign of cyber-enabled theft of intellectual property and trade secrets against U.S. With the return of Chinese hacking, the United States should develop an international attribution-and-sanction regime sanction the companies that benefit from cyber espionage and strengthen counterintelligence outreach to startups and small companies in artificial intelligence (AI), quantum, semiconductor, telecommunications, and other sectors central to Chinese technology strategies. companies, more can be done to fight cyber-enabled industrial espionage.
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While the Trump administration is mounting a broad campaign to pressure Beijing into ending the theft of intellectual property (IP) and trade secrets from U.S. Lipman Chair in Emerging Technologies and National Security and Director of the Digital and Cyberspace Policy Program