The US expresses its “disappointment” over China’s failure to hand over fugitive Edward Snowden.
After talks with senior Chinese officials, US Deputy Secretary of State William Burns said Beijing’s actions undermined “trust” in bilateral ties.
China said Hong Kong – which allowed to Edward Snowden to leave Russia – had acted in accordance with the territory’s law.
Meanwhile, Microsoft has been accused of working with US intelligence bodies to help intercept users’ data.
Citing the latest secret documents leaked by Edward Snowden, The Guardian newspaper said Microsoft had worked with the FBI and the NSA to facilitate access to information.
The newspaper claimed Microsoft allowed the NSA to circumvent its system of email encryption.
It also said information had been made available through access to cloud storage service SkyDrive and chat service Skype.
In response, the company said in a statement: “Microsoft does not provide any government with blanket or direct access to SkyDrive, Outlook.com, Skype or any Microsoft product.”
It added that it had provided customer data only in response to lawful government requests.
William Burns was speaking after the two-day talks with the Chinese officials on trade and cyber security in Washington.
“We were disappointed with how the authorities in Beijing and Hong Kong handled the Snowden case, which undermined our effort to build the trust needed to manage difficult issues,” he said.
In response, Chinese state councillor Yang Jiechi said Hong Kong’s actions were in accordance with its law.
“Its approach is beyond reproach,” Yang Jiechi added.
The row over Edward Snowden has strained relations between the US and China.
Washington wants to prosecute Edward Snowden over the leaking of thousands of classified US intelligence documents.
Edward Snowden, 30, is believed to be currently staying at a Moscow airport.
He has sent requests for political asylum to at least 21 countries, most of which have turned down his request.
However, Bolivia, Nicaragua and Venezuela have indicated they could take Edward Snowden in.