Sat, 25 Jan 2020

Reuters' Distributor Blocked Company's Hong Kong Protest News

Voice of America
14 Dec 2019, 07:05 GMT+10

LONDON - As anti-government demonstrations engulfed Hong Kong in August, Reuters broke a sensitive story: Beijing had rejected a secret proposal by city leader Carrie Lam to meet several of the protesters' demands in a bid to defuse the unrest.

The story buttressed a main claim of the protesters: that Beijing is intervening deeply in the affairs of the semiautonomous city. A state-run newspaper denounced the story as "fake" and "shameful." The article soon became unavailable in mainland China.

It wasn't the Chinese government that blocked the story. The article was removed by Refinitiv, the financial information provider that distributes Reuters news to investors around the world on Eikon, a trading-and-analytics platform.

The article was one of a growing number of stories that Refinitiv - which until last year was owned by Reuters' parent company, Thomson Reuters Corp. - has censored in mainland China under pressure from the central government.

Since August, Refinitiv has blocked more than 200 stories about the Hong Kong protests plus numerous other Reuters articles that could cast Beijing in an unfavorable light.

Internal Refinitiv documents show that over the summer, the company installed an automated filtering system to facilitate the censoring. The system included the creation of a new code to attach to some China stories, called "Restricted News."

As a result, Refinitiv's customers in China have been denied access to coverage of one of the biggest news events of the year, including two Reuters reports on downgrades of Hong Kong by credit-rating agencies. Nearly 100 other news providers available on Eikon in China have also been affected by the filtering.

China's heavy hand

Censorship in China has been intensifying in recent years under President Xi Jinping, and Western businesses have come under rising pressure to block news, speech and products that Beijing sees as politically dangerous.

Refinitiv generates tens of millions of dollars of annual revenue in China. As Reuters reported in June, citing three people familiar with the matter, Refinitiv began the censorship effort earlier this year after a regulator threatened to suspend its Chinese operation.

Refinitiv has joined a lengthening list of companies complying with Chinese demands. They include hotel giant Marriott International Inc., which last year temporarily shut down its Chinese websites and apologized for, among other things, listing Taiwan as a separate country in a customer questionnaire.

Several U.S. airlines also stopped describing Taiwan as non-Chinese territory on their websites. Beijing considers the self-governed island part of China. The companies have defended their actions.

'Naked political aggression'

The censorship has angered the top news and business executives of Reuters and the directors of the Thomson Reuters Founders Share Co. Ltd., an independent body tasked with preserving the news agency's independence.

Speaking to Reuters journalists on a visit to the Singapore newsroom in October, Kim Williams, the Australian media executive who chairs the body, lashed out at Refinitiv, calling its actions "reprehensible" and a capitulation to "naked political aggression" from Beijing.

Editor-in-chief Stephen J. Adler told Reuters journalists in London in November that the censorship was "damaging" the brand. "I don't approve of it," he said.

Refinitiv Chief Executive David Craig and Thomson Reuters CEO Jim Smith have held multiple talks, as recently as this week, to try to resolve the issue, said people familiar with the matter.

"We recognize that the processes that were put in place earlier this year need to be improved and are actively working on enhancements," Refinitiv spokesman Patrick Meyer said of the filtering system in a statement. "As a global business, Refinitiv must comply with the laws and regulations of the countries in which we operate."



Refinitiv was formed last year when a consortium led by private equity giant Blackstone purchased a 55 percent stake in Thomson Reuters' Financial & Risk business, which included the Eikon terminal business, for about $20 billion and rebranded it.

Refinitiv is by far Reuters' largest client, providing nearly half its revenue. As part of the spin-off deal, Refinitiv agreed to make inflation-adjusted annual payments of $325 million to Reuters over 30 years for news - a reliable income stream that is rare in the media business.

Tiananmen taboo

Reuters reported in June that Refinitiv had blocked several Reuters stories under government pressure. The articles were about the 30th anniversary of the bloody suppression of pro-democracy demonstrations in Beijing's Tiananmen Square.

According to the people with knowledge of the matter, Refinitiv acted after the Cyberspace Administration of China, or CAC, which controls online speech, threatened to suspend the company's service in China if it didn't comply.

The CAC did not respond to questions about this article. China's Foreign Ministry had no immediate comment.

Refinitiv began ramping up its efforts to purge offending China coverage. Internal Refinitiv documents and emails describe how the company over the summer created an automated filtering system - referred to as the "Strategic China filter" - to block certain stories to Eikon users in mainland China.

In July, Refinitiv's news platform architecture director requested that a new code be created, called "Restricted News," that could be added to articles. He asked that it "should be hidden for all users (internal and external)," according to notes of a conference call on July 17 where the code was discussed.

One reason was that Refinitiv didn't want to give its mainland China customers the ability to disable the filtering. In an email to colleagues, the platform director explained the code: "The flag is to highlight news that requires additional processing, due to Chinese govt restrictions, prior to consumption in China."

Keyword filter

The filtering system is designed to block stories for readers in mainland China but allow them to be accessed in other markets. It looks for restricted keywords in headlines, such as "Hong Kong" and "protest," according to a person familiar with the matter.

Reuters found no evidence that Refinitiv has deployed the filtering system in other nations.

Besides Reuters articles, the filtering has also blocked one or more stories from 97 other news providers that are available inside China on the Eikon system - including Xinhua, China's official state-run news agency.

On December 3, Refinitiv blocked a Xinhua story about a small demonstration in Hong Kong by pro-Beijing residents. They were quoted heatedly denouncing Washington over a new U.S. law that supports Hong Kong's pro-democracy protesters.

Last weekend, Hong Kong witnessed another huge protest, with turnout estimated at 183,000 by police and four times that by organizers. Citizens of all stripes marched, from students to professionals to the elderly.

Eikon users in mainland China couldn't read the Reuters story on the mass protest. It was blocked.

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