Amid calls for action against Chinese hackers, the U.S. is reportedly set to unveil new sanctions against Chinese companies with connections to such groups earlier than expected.
Citing three unnamed U.S. officials, the Financial Times wrote on Thursday that the sanctions would likely come after the Labor Day holiday next week. Observers had widely expected action to come after Chinese President Xi Jinping visits Washington at the end of this month, but the officials quoted said that taking action now would “give China time to cool down” before the visit.
The action would apply to groups engaged in commercial espionage, but not political espionage. Chinese groups have ravaged U.S. commercial secrets in recent years: In July, the Federal Bureau of Investigation reported that of companies it surveyed, 50 percent had reported the electronic theft of trade secrets or intellectual property. Of those, 95 percent suspected China as the culprit.
Last weekend, the Washington Post quoted White House officials who said the administration was prepared to take “unprecedented” action against China on the issue. If sanctions are imposed, it will be the first time that an executive order President Obama signed in April has been used.
“As the president said when signing the executive order enabling the use of economic sanctions against malicious cyber actors, the administration is pursuing a comprehensive strategy to confront such actors,” one official said. “That strategy includes diplomatic engagement, trade policy tools, law enforcement mechanisms, and imposing sanctions on individuals or entities that engage in certain significant, malicious cyber-enabled activities.”
Republicans have been vocal in calling for sanctions on China, but have also demanded that sanctions respond to political cyber espionage that the country has conducted. That includes the breach of the Office Personnel Management that resulted in the exfiltration of personal information on more than 22 million people who have applied for security clearances with the U.S. government. The administration has not blamed China for the breach, which means that a sanctions regime related to commercial espionage is unlikely to satisfy critics.
As one example, Reps. Randy Forbes, R-Va. and Joe Wilson, R-S.C., inserted themselves into the issue with a letter to the administration on Thursday. The pair called on President Obama to “let the world know that state-sponsored hacking will have tangible repercussions” and to protect “the intellectual property and personal data of U.S.-based companies, as well as government data and personnel information.”
The administration is also considering whether to include Russia in sanctions, though that country is less active in hacking for commercial gain. However, defense officials have said China and Russia are collaborating to piece together intelligence information that the countries have stolen by hacking government databases.
