Administration pushes back on IT sourcing restrictions

The Obama administration does not think new restrictions on government procurement of IT products sourced from China will benefit cybersecurity. The measure was tucked away in the continuing resolution Obama signed into law March 26, and requires NASA, the Commerce and Justice departments and the National Science Foundation to clear IT acquisitions that involve companies with supply-chain links to Chinese state-owned or state-directed firms.

White House spokeswoman Caitlin Hayden told The Hill on April 5 that, "The undefined terms of this provision will make implementation challenging." The measure, she said, "could prove highly disruptive without significantly enhancing the affected agencies' cybersecurity. While the administration has raised concerns about the cyber threats emanating from China, resolving this issue requires open dialogue between the U.S. and China."

While the White House appears to be seeking the removal of the language regarding China IT sourcing from future appropriations bills, the provision is currently the law of the land, and the government is expected to put forth rules for its implementation. A congressional staffer familiar with the issue told FCW that he had "every confidence that the law would be implemented effectively and appropriately," and said, "I hope agencies remember that it's Congress and not the White House that's responsible for their appropriations." The language in the continuing resolution was originally proposed by Rep. Frank Wolf (R-Va.) who heads the Appropriations subcommittee that funds the four agencies affected by the law. Wolf has been among the most outspoken members of Congress on the potential threat posed to U.S. interests from IT firms with strong Chinese government connections.

Industry groups are also pushing back against the rule. U.S.-China Business Council president John Frisbie urged the leadership of both parties in the Senate and the House of Representatives to reject "country-specific restrictions" in cybersecurity legislation. In an April 8 letter, Frisbie wrote, "The U.S. and Chinese government should cooperate to address cybsersecurity issues as they impact the commercial relationship, starting with one fundamental premise: commercial espionage should not be tolerated and if it is not addressed, it could undermine a constructive commercial relationship."

This underscores the complaint in an April 4 letter signed by the U.S. Chamber of Commerce, TechAmerica, and other key groups warning that the measure set "a troubling and counterproductive precedent that could have significant international repercussions and put U.S.-based global IT companies at a competitive disadvantage in global markets."

The congressional aide expects to see the language included in the 2014 version of the appropriation for the affected agencies, and that it might be extended by other appropriators. "We see it as a pilot strategy to deal with this problem," he said.