China has done little to improve access to and the security of the Internet in the last year, in some cases lending its support to Web-based attacks on foreign computer systems and tightening its control on the Internet, according to a Wednesday report.

Methods in China for infiltrating American computer systems as well as those of foreign governments have become increasingly sophisticated in the last year, but the average citizen in the country has fewer options when it comes to freedom on the Web, according to the U.S.-China Economic and Security Review Commission (USCC).

The USCC is charged with monitoring the national security implications of doing business with China. Wednesday's report is the 12-member commission's eighth report on the topic since 2000. It covers a variety of topics, including Internet freedoms, and this year's report includes 45 recommendations for Congress to consider.

"The Chinese government continues to maintain a sophisticated Internet filtering system to restrict freedom of speech," the report found. "Beyond filtering, the Chinese government has increasingly sought to direct public discussion over the Internet."

"Moreover, the penetration of Google's computer network this year has renewed concerns about the Chinese government's tolerance or possible sponsorship of malicious computer activity," the USCC continued.

The commission found "some lever of state support" for Chinese individuals and organizations that attacked American computer systems and those of foreign governments, vice chairman Carolyn Bartholomew said in a statement.

"In addition, for a brief period in April, Chinese Internet service providers 'hijacked,' or inappropriately gained access to, U.S. Internet traffic," Bartholomew said. "This incident affected numerous government sites, including those for the Senate and the Office of the Secretary of Defense."

In a statement provided to Reuters, China Telecom denied hijacking U.S. Internet traffic.

Earlier this year, Google discovered a sophisticated attack that originated in China, which was designed to steal Google intellectual property and access the Gmail accounts of Chinese human rights activists. As a result, Google said it would stop censoring its search results in China, and possibly pull out of the Chinese market altogether depending on the reaction of Chinese officials.

In a white paper released earlier this week, Google said that Internet censorship acts as an impediment to free trade; a position the USCC said was persuasively argued.

"In order to successfully reduce restrictions on and disruption of the Internet, governments must focus on three critical areas as they negotiate trade agreements: advancing the unrestricted flow of information; promoting new, stronger transparency rules; and ensuring that Internet services can be provided without a local investment," Google wrote.

"An open Internet has been and remains an absolutely critical component of the new information economy's ability to empower individuals and create shared information markets," Google continued. "Closed systems are antithetical to the Internet's success and will significantly disable its potential to support trade and innovation going forward."

Unfortunately, China does not appear to be moving away from a closed system, the USCC found.

"Our report notes that over the past year China has continued to tighten its control on the Internet, dashing hopes for the Internet to act as a means to liberalize Chinese society," Bartholomew said. "Authorities skillfully balance the need to limit speech and information on the Internet against the Chinese public's desire to participate in discourse about the country's social conditions."

The USCC said China often delegates censorship responsibilities to private companies, like Baidu. The fact that Baidu is "heavily funded by American investors [has] implications for the United States," Bartholomew said.

Google said that governments should honor World Trade Organization obligations "and develop new international rules that provide enhanced protection against these trade barriers of the 21st century."

The USCC said this approach "is particularly important in light of the proliferation of state-based Internet censorship, now employed by some 40 countries—a tenfold increase over the past decade."