Bill Gates suggested on Tuesday that a US law governing how internet companies deal with censorship overseas could help to resolve recent concerns stemming from their activities in China.

However, he came out against an outright ban on working in such countries, and argued that the internet was “a tool for openness” that could not be thwarted by official attempts to block information.

“I don’t think that a [rule] that said you shouldn’t do business in some place whose standards aren’t identical to the US would work,” Mr Gates said in an interview with the Financial Times. “Germany bans Nazi hate speech - the US clearly constitutionally protects that. Should I do business in Germany?”

The Microsoft chairman added, though, that legislation could sometimes be useful in regulating the behaviour of US companies overseas.

“I think something like the Foreign Corrupt Practices Act has been a resounding success in terms of very clearly outlining what companies can’t do and other rich countries largely went along with that. That’s a great thing.”

Suggesting that this idea was likely to arise during the current debate in Washington over the impact of internet censorship, he added: “I hope the people who make those things are sophisticated and not over-simplistic. Clearly people like ourselves are glad to go along with whatever reasonable things gets laid down.”

At the same time, Mr Gates claimed that official censorship could never succeed completely in thwarting the free flow of information over the internet.

“The internet overwhelmingly makes information available. It is not possible to block information, it is just not,” he said. “It’s so night and day versus when newspaper publishers and TV owners were small chokepoints that controlled the distribution of information. I think people have to [understand] what an open tool the internet is despite any firewall stuff, or any takedown orders that get given.”

Mr Gates said that, unlike Yahoo, Microsoft does not maintain any servers inside China, and so does not risk being forced to hand over personal information about any of its users. He added that Microsoft had only blocked the websites of users of its blogging service when told to do so by local authorities.

“We’re not involved in self-censorship. We are following those orders, which have come up once or twice,” he said.

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