Foreign companies in China brace for VPN crackdown

Chinese people and foreign firms are girding for a weekend deadline that will curb the use of unlicensed software to circumvent internet controls, as the government plugs holes in its "Great Firewall".

A virtual private network (VPN) can tunnel through the country's sophisticated barrier of online filters to access the global internet.

VPNs give users a way to see blocked websites such as Facebook, Twitter, Google and Western news outlets, as well as certain business network tools such as timesheets, email and directories.

But new government regulations unveiled last year sent chills among users of the software, with a March 31 deadline for companies and individuals to only use government-approved VPNs.

Currently, many foreign companies have their own VPN servers in locations outside of China. But in the future, dedicated lines can only be provided by China's three telecom operators.

Critics have slammed the new policy as a revenue grab that will eliminate cheaper VPN options and make internet users more vulnerable to surveillance.

But some companies are still planning to comply.

"We will apply for a VPN line with (the government)," the chief executive of a foreign-owned technology company told AFP.

"As a company that is globally-focused based in Beijing, I think that's the best option... because we don't want to break the rules or have our VPN access disrupted," she said, requesting anonymity.

Some embassies in Beijing experienced disruptions to their communications due to restrictions on VPN usage late last year, prompting the European Union delegation to send a letter to the government to complain, diplomatic sources told AFP.

American Chamber of Commerce Shanghai President Kenneth Jarrett warned that foreign companies and their employees could "bear the brunt of the new policies".

"Foreign companies, especially entrepreneurs and smaller companies rely on overseas platforms such as Google Analytics and Google Scholar," Jarrett told AFP.

"Limiting access to affordable VPNs will make it harder for these companies to operate efficiently and just adds to the frustration of doing business in China."