Ann Beynon from BT says the telecom company would prefer Welsh language services to remain voluntary.
A bid by the Welsh Assembly Government for more powers to make laws to promote the Welsh language has been published.
The legislative competence order (LCO) includes the right to require some private companies to use the language, including energy and telecoms firms.
But some MPs may resist the idea that using Welsh could become a legal requirement for private firms, and the bid was criticised by business leaders.
This LCO is a key part of the Labour-Plaid Cymru coalition agreement.
Heritage Minister Alun Ffred Jones said the transfer of powers was needed "so that we are better able to secure our goal of creating a truly bilingual Wales".
South Wales Chamber of Commerce managing director David Russ warned that "requiring private companies to embrace the Welsh language wholeheartedly would be particularly thoughtless during these tough times".
The last thing that businesses in Wales need at the moment is unwanted regulation saddling them with additional costs
David Russ, South Wales Chamber of Commerce
However, Welsh Secretary Paul Murphy stressed "the detail of this draft legislative competence order is not set in stone".
The LCO is the first stage in passing a Welsh law (measure) and seeks to give the assembly government more powers over the Welsh language.
If the LCO is approved the assembly government will introduce a measure (Welsh law) on the matter.
Before it is approved it has to be scrutinised by both the Welsh assembly and Westminster.
The process of drawing it up has taken a year longer than planned.
The LCO would allow the assembly government potentially to bring a wide range of organisations under the provisions of the Welsh Language Act 1993.
PRIVATE COMPANIES WHICH COULD BE AFFECTED
Gas, water, or electricity services
Postal service and post offices
Education, training, or career guidance
Services to develop or award education or vocations qualifications
The private companies which could be compelled to treat Welsh and English equally include gas, water and electricity services, telecommunication services - including mobile phone companies - and railway operators.
BT called for clarification, saying it would prefer the existing voluntary system to continue and could not see the benefits of legislation.
The move could also mean any company which provides services to the public under an agreement with a public authority, like a contract with the assembly government or council, could be compelled to provide those services bilingually.
Mr Jones said the assembly was the "appropriate place" to make laws on the language.
He said: "Westminster passed three laws on the Welsh language during the last century, the last occasion was in 1993.
"With the existence now of the national assembly, it is unlikely to introduce another one.
"We need to make sure that any legislation is suitable for the 21st Century, and allows the assembly to make decisions that secure the development and sustainability of the Welsh language".
But Mr Russ insisted that "the last thing that businesses in Wales need at the moment is unwanted regulation saddling them with additional costs".
"Whether or not to use the Welsh language should remain a matter of choice for private companies," he said.
"Legislation is not the right way to encourage the adoption of Welsh and more effort should be made to quantify the business benefits of using the language.
"Successful businesses evolve to meet the needs of their customers and, if providing services in both Welsh and English proves more beneficial than just using the lingua franca, the take up of Welsh by companies will inevitably increase.
Mr Russ said that while customers' rights to deal with businesses through the medium of Welsh "must be respected", business should have the right to "opt-out of any proposed Welsh language initiatives".
Several Labour MPs have privately expressed scepticism about extending the scope of current language legislation to the private sector.
Welsh Conservative heritage spokesman Paul Davies said his party would study the plans "in detail".
"While we remain committed to supporting the Welsh language - as we set out in our 2007 assembly manifesto - we do not want to see any barriers erected to businesses in Wales which would damage investment and competitiveness, particularly at a time of economic recession," he said.
Assembly presiding officer Lord Elis Thomas told the BBC Politics Show the bid for powers on the language was hugely important.
Mr Murphy promised a "transparent debate on the implications of the proposed order, especially at this time of economic downturn".
He said he had been "approached by business leaders" who were "keen to discuss issues relating to the proposed order".
But any serious weakening of the order would cause tension between Cardiff Bay and Westminster.
Any changes may also cause problems between the two coalition partners in the Welsh assembly.
Cymdeithas yr Iaith Gymraeg, a Welsh language pressure group, challenged the assembly government to be more ambitious in its requests for further powers.
Chair Menna Machreth said: "Even though there are many things about the LCO to be welcomed, the Welsh Assembly Government has prevented the people of Wales from gaining access to the Welsh language because of the absence of comprehensive statutory rights in the LCO.
"The Welsh Assembly Government has erected large 'no entry' signs preventing access to large areas of the private sector."
Ms Machreth promised a "new period of campaigning" on the language, demanding a "measure that is strong, transparent and just".
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