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Google has snagged a licence to do business in China, and has registered the URL www.google.com.cn. According to reports, is planning to open an office there by the end of the year.

Web consults at Shanghai iResearch note that Google already has more than 21 per cent of the Chinese search market, which ranks it in third place, after Yahoo and Baidu.com, the BBC reports.

The move certainly opens a big market to the search giant, China has around 94m people with web access, but it also raises several ethical questions. Chinese authorities are well known for their rather inflexible approach to the web, and for their Herculean efforts to maintain some rigid censorship rules.

Authorities are particularly opposed to some of the more racy content available online, but have also turned their noses up at The Sims for fear that the game would corrupt the nation's youth.

Any content which threatens "state security, damaging the nation's glory, disturbing social order and infringing on other's legitimate rights" is also banned.

We have asked Google how working in this kind of environment squares with the company's informal motto: "Don't be evil" and striving towards the "highest possible standard of ethical business", as it states in its code of conduct.

Google stresses that the license is just to set up a representative office in China, and no more than that, although it does conceed that it is very interested in the market. For the time being, it will be using the office as a base from which to conduct market research, and learn more about the market, a spokeswoman for the company told us.

As for the ethical considerations, it says that until it is doing business proper in China, it can't really talk about them, because it doesn't know exactly what its situation will be. When it does, it will address these issues. ®

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