This article originally appeared at The WHIR
China is delaying a draft counter-terrorism bill that would require companies to keep servers and user data within the country and hand over encryption keys to the government if put into law.
According to a report by Reuters on Friday, China has decided to suspend the third reading of that law, putting it on hiatus for now.
White House cybersecurity coordinator Michael Daniel said that the US considers the law “as something that was bad not just for US business but for the global economy as a whole, and it was something we felt was very important to communicate very clearly to them.” Daniel was speaking about the law in a discussion at the Information Technology and Innovation Foundation last week.
While it is unclear whether the bill would proceed or not, it could be picked up again at any point as only the standing committee – not the full parliament – is required to pass the law, according to an anonymous source speaking to Reuters.
The initial draft of the bill was published last year, and also requires companies to censor terrorism-related content. The second draft was read last month.
While the law would apply to both foreign and domestic firms, US officials believe it could unfairly target foreign companies operating in China, particularly with the new banking rules and anti-monopoly investigations in China.
This story originally appeared at http://www.thewhir.com/web-hosting-news/china-delays-counter-terrorism-bill-amid-concerns-foreign-tech-firms