International Trade Lawmaking @ Beijing Normal University

Global Internet of Things Conference (GIOTC) was held on November 23-24, 2010 in Beijing National Convention Center. Hundreds of people, most from business and administration, joined the conference and side exhibition. I did not come to the confusing-structured conference hall until the afternoon of November 23, missing a couple of presentations from European Commission and many companies. In the afternoon session, the first half, chaired by Rob van Kranenburg, comprised of 6 full presentations on technological developments or business applications. Mr. Kranenburg manage to mobilize his panelists to respond questions and generate new thinkings.

At around 16:30, I took over and chair the last panel on policy discussion. Unfortunately the panel is still more about technicality than polity. The speakers, in sequence, talked about IPv6 application for IoTs, operational side of IoTs and China-EU Joint Expert Group on IoTs. Later, 3 discussants from EU-China group, M2M and ESTI, joined the panel. I tried hard to open up the policy discussions on privacy, security, trust and policy-impact of standardization, but it does not seem attracting much responses.

It is interesting to see how IoTs suddenly become an eye-catching term in China after the high leader gave a speech with reference to it in April 2010. The speech cannot be googled for I always get an error page after inputting the relevant keywords. Weird enough. Anyway, government is making huge investment on technical development and industrial application with the aim of creating a new booming point for the economy.

The agenda and introduction of my panel is attach.

Internet for Things: Standards, Trade and Legal Issues

16：30-17：30 ( Discussion group: 60 mins )

Panel moderator:

Dr. Prof. Hong Xue, Director of Institute for Internet Policy & Law, Beijing Normal University

Speakers

1. Mr. Xiaodong Lee CNNIC

2. Prof. Jian Wang, Director of Center for International Business Studies, University of International Business and Economics

3. Mr. Hui Zhang, Secretary-General of working group sensor Network (WGSN)

Discussants

Mr. David Boswarthick, Technical Official of M2M standards group

Ms. Margot Dor, Director of Strategic Projects, ETSI

Mr. Philippe Cousin, European experts for the EU-China Internet of things Export Group

Introduction

We are impressed by the prospect that the Internet of Things is going to reshape the future of our technology, economy and society as a whole. The tremendous social impacts of IoTs signify the importance of establishing suitable governance regime to ensure progress, competitiveness, privacy and all the other essential values of information society.

This workshop will be specifically focusing on a few critical aspects of governance issues. As highlighted by European Commission’s “Internet of Things — An action plan for Europe”, governance addresses:

a)      Identification and identifier mechanism (IPv6);

b)      Privacy and personal data—right to silence chips

c)       Trust and Security, especially in trade operation

d)     Standardization (not necessarily be based on a deterministic or syntactic model but would instead be based on the context of the event; event-driven architecture )

Tim Berners-Lee made a presentation on November 22. When applauding for the long live of the web, he reemphasizes the value of universality. The primary design principle underlying the Web’s usefulness and growth is universality. When we move to communications between objects, standardization process need to keep delicate balance between the values of openness, interoperable and those of security and privacy.

What is the most sensational ICT news in China this week? Of course, it is the War between two animals–Penguin representing Tencent and  Tiger for Qihoo. After sending its 0.6 billion Chinese IM users a “Public Condemnation against Qihoo 360′” via pop-up windows, Tencent, which has been using the logo of two cute-looking penguins, publicly announced that it stops inter-operating with Qihoo’s 360’s newly released security program, Kou Kou Bodyguard. Tencent condemned Qihoo (Chinese name “Magical Tiger”) for hijacking users’ accounts through striping ads attached to QQ and redirecting QQ users to 360 browers. Qihoo that developed from an anti-virus company to the second large security and online assistance program service provider to 0.5 billion Chinese users denied the allegation that Kou Kou Bodyguard was a Trojan program to steal users’ information but has removed the program offline.

The War between  two leading Internet companies have devastated many Internet users, particularly who  had solely relied on these domestic services on IM, chatting, searching and email, etc. Under Tencent’s unilateral announcement, any user who has Qihoo 360 installed on the computer will not be able to login Tencent’s popular IM program QQ. Tencent has sued Qihoo for unfair competition and other claims to Beijing Court. Meanwhile, angry QQ users (especially those who paid fees to Tencent) have gather to bring collective action against Tencent. Ministry of Industry and Information Technology and Ministry of Public Security have summoned both parties for investigation.

For more information, please refer to “QQ-360 Battle Escalates into War” on WSJ.

The case shows the poor legal protection on privacy and personal information for more than 1 billion Internet users in China. It is widely believed that Internet giants are all blatantly detecting, collecting and trading their users’ privacy information for profit. In this case, tens of million of users become the virtual hostage of commercial strategy. Internet companies’ tremendous technical capacity can be a threat of the users’ choice and legitimate interest.

How would Tencent implement its anti-360 campaign? How did it detect and verify whether a user has uninstall Qihoo 360 or not? The answer is that Tencent’s widely used IM client integrates QQ Housekeep (formerly named QQ Doctor) that can automatically scan users’ drive and detect the files and programs installed on users’ computers.  Qihoo 360 had labelled QQ Doctor as a privacy-infringement program but Tencent rebutted that 360 lied for fear of competition in security product market.

In addition, malice competition actions not only directly hurt the consumers but potentially endanger the network security and stability. Civil disputes may deteriorate into cyber-crimes. Common use of cloud computing gives Internet giants “invisible hand” to manipulate, control and imperil billion’s of users. When data, computer and usage are more beyond the control of users, we have good reason to worry who is really in control.

The competent governmental agency, MIIT, finally stepped in the dispute. In an official announcement made on November 21,  both parties were condemned for acts of unfair competition and bad social impacts. Both were required to stop any acts that may damage the legitimate interests of users, stop mutual attacks and apologize to the users. The announcement also asked both to take appropriate make-up measures.  Interestingly, MIIT ordered both to carefully learn relevant laws and regulations and improve their moral construction. Let alone the morality standards that are apparently in doubt, people may wonder what kind of laws and regulations they should “carefully learn”. Obviously, there has no law or regulation to touch a commercial operator’s proactive or aggressive self-defensive actions.

CIETAC Presiding Arbitrators’ Seminar was held on November 5-6 in Beijing East Garden International Conference Center. Around 50 academic, lawyers, in-house counsels and CIETAC staff took the shuttle bus and headed to the lakeside villa at the sunny noon of Friday.

This is the first seminar organized by CIETAC to brainstorm Presiding Arbitrators. Unlike ad hoc arbitration that is widely adopted around the world, Chinese Arbitration Law only allows for institutional arbitration.  The state-sanctioned institutions should guarantee the quality of arbitral awards. Presiding arbitrators are primarily responsible for fair and reasonable decisions. CIETAC has been emphasizing the responsibility and accountability in arbitral proceedings.

A couple of issues was discussed and hotly debated. For example, a couple of senior arbitrators (in their 70s or 80s) mentioned the divergence of international arbitration and domestic arbitration, which has always been a Chinese characteristic. However, after China becomes a WTO Member and complies with the National Treatment principle, it does not make much sense to segregate proceedings based on arbitrary judgment on “overseas” factors. There are more Chinese companies making Overseas Director Investment to other countries. It would be more controversial to draw the line.

There are other interesting discussions, such as how to handle the case when a persistent presiding arbitrator refuses to consult the co-arbitrators, how to define the relation among “arbitraral court, “expert advisory commitment” and Arbitration Commitment, etc.