On Wednesday, China’s commerce ministry said it “firmly opposes” the United States’ proposed ban on the sale of connected vehicles that use Chinese or Russian software and hardware technology.

Most new vehicles are considered to be “connected” because they can share data with other vehicles and infrastructure with the help of onboard software, hardware and internet access.

The U.S. warns that data collected by Chinese or Russian software in connected and autonomous vehicles could pose a threat to national security.

A spokesperson from China’s Ministry of Commerce said the proposed U.S. ban has no “factual basis, violates the principles of market economy and fair competition, and is a typical protectionist act.”

“China urges the United States to stop its wrong practice of generalizing national security, immediately revoke the relevant restrictions, and stop its unreasonable suppression of Chinese companies,” according to a ministry statement.

The proposed rule is the latest example of the deteriorating relationship between Washington and Beijing.

In February, the Biden Administration said it would probe Chinese cars that pose a risk to national security. The U.S. Department of Commerce said it opened the probe because vehicles “collect large amounts of sensitive data on their drivers and passengers (and) regularly use their cameras and sensors to record detailed information on U.S. infrastructure.”

The Biden Administration also implemented a 100% tariff on Chinese-made EVs earlier this month, citing unfair business practices and the potential for Chinese EVs to flood international markets.

The new proposed prohibition on connected vehicles applies both to the software and hardware that link vehicles to the outside world. It did not specify which manufacturers are likely to be impacted by the rule, which will be finalized after a 30-day period for public comment.

In a press release Tuesday, the Coalition for a Prosperous America, or CPA, voiced its support for the proposed ban.

“For years, the CCP [Chinese Communist Party] has aggressively pursued global dominance in the automotive industry building tremendous overcapacity to dominate their home market and to displace auto manufacturing worldwide,” said the CEO of CPA, Michael Stumo.

“The Commerce Department’s proposed ban on this technology is an important measure to protect our automotive sector and secure Americans’ sensitive information,” he added.

China’s commerce ministry also condemned the U.S. on Wednesday for its newly proposed ban and tariffs implemented earlier this month, saying Washington placed "high tariffs on Chinese cars, restricted participation in government procurement, and introduced discriminatory subsidy policies."

“Now, on the grounds of so-called national security, it [Washington] has slandered Chinese connected car software, hardware and complete vehicles as 'unsafe' and restricted their use in the United States,” a ministry statement said.

Some information for this report came from Agence France-Presse.