Microsoft examines new rules

Business Asia, March 3, 2000

Microsoft Corp, the world's largest software maker, is in talks with Chinese officials to ensure that rules on encryption technology won't delay plans to roll out its Windows 2000 operating system.

The company said it expects that as a result of the discussions, the release of the software platform won't clash with new local rules covering encryption systems designed to protect data sent over the Internet.

"We don't expect any problems and plan to release Windows 2000 in China on March 20," said Sharon Zhang, spokeswoman for Microsoft's China unit. She made the comment after the Asian Wall Street Journal reported today that Windows 2000 may run into troubles because of the Chinese encryption rules.

China is targeting the use of encryption software as part of a wider effort to keep the Internet in check and recently demanded that foreign companies register the encryption software they use.

Regulations released in the People's Daily newspaper last October suggest that China's next step may be to curb the use of foreign encryption software by locals.

To prevent encryption issues from creating a longer delay, Microsoft is talking with the Ministry of Information Industry, the State Encryption Management Committee and other agencies on what the rules actually mean.

"There are some errors in the regulations that need to be clarified," Zhang said. She declined to be more specific about what the errors are.