American firms in China at risk from new law, US officials say

US counterintelligence officials are amping up warnings to American executives about fresh dangers to doing business in China under an amended Chinese law to combat espionage.

- Kate O'Keefe

A bulletin being issued Friday by the National Counterintelligence and Security Centerand viewed by The Wall Street Journal warns that the revised law is vague about what constitutes espionage and gives the government greater access to and control over companies' data, potentially turning what would be considered normal business activities into criminal acts.

The amended counterespionage law, which takes effect Saturday, has unsettled foreign businesses in China. The publication of those revisions this spring came amid a wave of raids, inspections and other acts by Chinese authorities against foreign, chiefly American businesses, as tense US-China relations deteriorated further.

The revised law expands the definition of espionage without defining terms in a way that is "deeply problematic for private sector companies," said Mirriam-Grace MacIntyre, who leads the counter-intelligence center.