DHS advises companies to avoid Chinese hardware and software services

Credit: Jason Redmond/AFP

The U.S. Department of Homeland Security is urging US companies to completely avoid using hardware or services produced or linked to Chinese state corporate ownership because of data theft concerns.

In a business advisory published on Wednesday, the DHS said that Chinese products and services could contain backdoors or other data collection systems. It also said that data theft could occur via insider threats and business partnerships. The goal is to harvest data from western companies for use in furthering China's economic goals, the department added.

The DHS urged U.S. companies to take care when sharing data with Chinese firms; using equipment produced or maintained by Chinese companies; and even when working with companies that have Chinese citizens in "key leadership and security-focused roles."

According to the DHS, local Chinese national security laws allow the government to force domestic companies or citizens to engage in espionage or intellectual property theft.

Acting Homeland Security Secretary Chad F. Wolf said on Wednesday that "for too long, U.S. networks and data have been exposed to cyber threats based in China which are using that data to give Chinese firms an unfair competitive advantage in the global marketplace."

On Monday, Wolf also called China a "clear and present danger" to the U.S. that it couldn't ignore.

In addition to the harvesting of data from western companies and citizens, the advisory also highlights China's "history of manipulation, misuse, and exploitation of that data to serve PRC business and economic goals."

"Any person or entity that chooses to procure data services and equipment from PRC-linked firms, or store data on software or equipment developed by such firms, should be aware of the economic, reputational, and, in certain instances, legal, risks associated with doing business with these firms," the DHS said in a press release.

The U.S. government has also taken action against specific Chinese firms because of espionage concerns. In May 2019, it levied two bans on Chinese phone maker Huawei that blocked it from using U.S. technology and blocked U.S. firms form using its hardware. Earlier in December, the Federal Communications Commission told certain U.S. carriers to remove all Huawei equipment in their infrastructure.