By David B. Rivkin Jr. and Anastasia Lin

July 13, 2020, in the Wall Street Journal

Facebook, Google and Twitter announced this month that they will refuse to comply with customer-information requests from Hong Kong authorities until the companies review the implications of a new Chinese security law designed to suppress dissent in the territory. If the tech companies don’t cave in, it will be a rare instance of Western businesses standing firm against Beijing’s intimidation.

Corporations typically kowtow, fearful of losing access to China’s massive market. International airlines, including American, Delta and United, changed their websites so that Taipei isn’t listed as being in Taiwan. The general manager of the National Basketball Association’s Houston Rockets apologized for tweeting an image that read “Fight for Freedom. Stand with Hong Kong.” Mercedes-Benz apologized for an English-language Instagram post that included an innocuous quote from the Dalai Lama. The Big Four accounting firms issued statements criticizing Hong Kong protests after some of their employees took out an ad supporting them.

Using its economic power to pressure Western corporations is a key element of Chinese statecraft. The Communist Party keenly appreciates that Western entities are far more credible than Chinese government or media. China scrutinizes statements by Western companies, focuses on those that are even mildly critical of its behavior, and threatens them on social media with economic retaliation and blacklisting.

Such threats often appear to emanate from private Chinese citizens. But given the government’s heavy censorship of Chinese social-media platforms, they inevitably bear the party’s imprimatur. Moreover, the Chinese government almost always backs up the statements attributed to its citizens, waging a joint campaign, so that the language of these “private” complaints tracks Communist Party propaganda.

Beijing also attempts to suppress authentic Chinese voices critical of its human-rights abuses. One of us (Ms. Lin) represented Canada in the Miss World 2016 finals in Washington. The London-based Miss World Organization—most of whose sponsors are Chinese companies—isolated her from the media during the pageant and threatened to disqualify her after she was seen speaking informally to a Boston Globe columnist. The ban on her contact with journalists was ameliorated only after intense public pressure.

It’s too much to expect corporations, whose objective is to make money for shareholders, to take a lonely stand against a government that controls access to a major market. But U.S. lawmakers could stiffen corporate spines. In response to the Arab League boycott of Israel, Congress in 1977 made it illegal for U.S. companies to cooperate with any unsanctioned foreign boycott and imposed civil and criminal penalties against violators. That legislation and the implementing regulations “have the effect of preventing U.S. firms from being used to implement foreign policies of other nations which run counter to U.S. policy,” according to the Commerce Department.

Antiboycott regulations forbid U.S. companies to “agree” to eschew doing business in Israel or with a company already blacklisted by the Arab League, or to cooperate with the boycott’s enforcement by providing information about business relationships with Israel or blacklisted companies. All requests for such cooperation must be reported to the Commerce Department. The regulations presume that any action taken in response to boycott-related requests violates the law. It isn’t sufficient to claim that one’s boycott-related speech or activity is based on one’s own views.

These regulations survived legal challenges from companies that claimed violations of their First Amendment right to free speech. Federal courts upheld the rules as narrowly tailored restrictions on commercial speech driven by a compelling government interest. American companies eventually grasped that the rules protected them from foreign pressure. In time, antiboycott compliance became part of American corporate culture and didn’t require much enforcement.

Beijing’s efforts to force American companies to support and comply with its propaganda and deception campaigns and furnish information on Chinese dissidents are similarly inimical to vital American interests. Preventing Western companies from participating in Chinese propaganda campaigns would diminish China’s soft power and impair its ability to use economic blackmail as a tool of statecraft.

Congress should enact legislation prohibiting American companies, as well as foreign entities doing business in the U.S., from cooperating with any Chinese effort to enlist them for propaganda or furnish information on dissidents. In particular, they would be barred from changing their public statements and social-media presence in response to Chinese pressure or from taking other steps to placate Beijing, whether its demands are communicated directly or indirectly. Any such Chinese demands would have to be reported to the U.S. government.

With most Americans—91%, according to a March Pew Research Center report—agreeing that Beijing threatens American interests, such legislation should be able to win bipartisan support. It would also be constitutionally defensible as a narrowly tailored regulation of commercial speech supported by a compelling government interest—countering Beijing’s push for global dominance.

The goal would not be to prevent companies from speaking, or to compel their speech, on China-related issues. They could not, however, legally comply with Chinese government attempts to direct their speech. Like the antiboycott laws, such a statute would protect Western companies, enabling them to tell Beijing that they are unable to comply with its demands. The U.S. can’t stop Chinese state institutions from spreading propaganda, but it can use the law to shield Western companies from the Communist Party’s intimidation.

Mr. Rivkin practices appellate and constitutional law in Washington. He served in the White House Counsel’s Office and Justice Department under Presidents Reagan and George H.W. Bush. Ms. Lin, an actress, was Miss World Canada 2015 and 2016. She is the Macdonald-Laurier Institute’s ambassador for China policy and a senior fellow at the Raoul Wallenberg Centre for Human Rights. She is the wife of James Taranto, the Journal’s editorial features editor.

Source: https://www.wsj.com/articles/a-way-to-curb-chinese-intimidation-11594680594