A key congressional panel endorsed legislation on Tuesday that would bar U.S. Internet companies from cooperating with authorities in China and other repressive regimes.
The U.S. House Foreign Relations Committee voted in favor of legislation designed to stop companies such as Yahoo from turning over personal information to governments that use it to suppress dissent.
"Dictatorships need two pillars to survive -- propaganda and secret police. The Internet -- if misused -- gives them both in spades," Republican Rep. Chris Smith, the author of the bill, said in a statement.
The bill would give individuals the right to sue companies in federal court if their information was improperly disclosed. It also requires Internet service providers to disclose to the U.S. government the terms and phrases they filter and the restrictions imposed on them in "Internet-restricting" countries.
The bill needs approval from the House Energy and Commerce Committee before it can reach the House floor. A companion bill has not yet been introduced in the Senate.
Smith, of New Jersey, first introduced the bill last year amid allegations Yahoo had provided electronic records to Chinese authorities that led to an eight-year prison sentence for writer Li Zhi in 2003.
In September 2005, Yahoo was accused of helping Chinese authorities identify Shi Tao, who was accused of leaking state secrets abroad and sentenced last April to 10 years in prison.
Google has come under fire for bowing to Chinese government pressure to block politically sensitive terms on its Chinese site. Microsoft has also angered human rights activists by shutting down the blog of a critic of the Beijing government.
Yahoo issued a statement on Tuesday saying the bill "highlights the complexity of the issues confronting U.S. companies doing business in China and similar countries ..." "We look forward to working constructively with Congress to find practical solutions," Yahoo said.
Microsoft issued a statement on Monday saying it was working with other technology companies to come up with a set of principles for dealing with "laws, regulations and policies that interfere with the achievement of human rights ..."
A Google spokesman said the company was still studying the bill and declined comment.
U.S. technology companies have stressed the difficult trade-offs they make in doing business in China's huge market, where the admission price is following local laws and where aggressive Chinese competitors would celebrate their pulling out.
The U.S. executives said Internet companies needed to work with each other and with the U.S. government to hammer out a broader approach on human rights and business issues in China.
The companies were sharply criticized by members of the house foreign relations committee at a hearing last year for alleged complicity with human rights abuses.