China is systematically excising American technology to advance its ambitions of technological sovereignty.
Local enterprises have been mandated to cease the use of cybersecurity solutions from specific firms in the United States and Israel, citing apprehensions that these Western technologies may be susceptible to cyber intrusions.
Chinese authorities have mandated that domestic companies discontinue the utilization of cybersecurity software from over a dozen firms based in the United States and Israel.
This directive arises from anxieties that such Western software could potentially be employed to gather and transmit sensitive Chinese information to foreign entities.
Identified Cybersecurity Companies Facing Prohibition in China
The exclusion list includes prominent U.S. firms, notably VMware (owned by Broadcom), Palo Alto Networks, and Fortinet.
Additional major players affected by this ban are CrowdStrike, SentinelOne, Rapid7, and McAfee. Moreover, subsidiaries of Alphabet, such as Mandiant and Wiz, are also encompassed within this embargo.
Israeli companies facing the ban include Check Point Software Technologies, Orca Security, and Cato Networks. CyberArk, recently acquired by Palo Alto Networks, finds itself on this list as well. Furthermore, Imperva, now under the ownership of the French conglomerate Thales, has been restricted.
In reaction to this directive, Broadcom’s stock plummeted by over 5% during Wednesday’s trading sessions. Palo Alto Networks observed a decrease of approximately 1%, while Fortinet’s shares fell by around 2%.
CrowdStrike, SentinelOne, and Recorded Future indicated that they maintain operations in the Chinese market, whereas Fortinet manages three offices in mainland China and one in Hong Kong. Notably, Broadcom operates six locations in China, and Palo Alto Networks has five.
Rationale Behind China’s Prohibition of Foreign Cybersecurity Companies
The current landscape sees China and the United States embroiled in fierce competition for supremacy in technological advancement.
Beijing has consistently championed a policy colloquially referred to as “Xinchuang,” aimed at achieving autonomy within the tech sector.
Chinese officials have increasingly voiced apprehensions that Western hardware and software may be intrinsically vulnerable to cyberattacks orchestrated by foreign nations, particularly in light of frequent allegations from Western cybersecurity entities regarding Chinese state-sponsored hacking.
For instance, Check Point recently released a report detailing a Chinese cyber initiative targeting European governmental institutions.
Concurrently, Palo Alto Networks accused Chinese hackers of infiltrating diplomats on a global scale. Beijing has consistently refuted these claims.
Moreover, local enterprises are being urged to pivot towards domestic providers such as 360 Security Technology and Neusoft.
This move mirrors prior actions taken by the U.S., which similarly banned software from Russian entity Kaspersky Lab in 2024.
Additionally, China has escalated its efforts to discourage state-owned enterprises from engaging with Western consultancy services and hardware.
Source link: Cryptopolitan.com.
