China tightens controls on tech companies

On Thursday, June 10, the National People’s Congress – the highest legislative body of the PRC – passed a law tightening control over data storage, reports Bloomberg. According to it, technology companies that incorrectly store or process “key government data” can have their licenses revoked, they can be closed or a fine of up to 10 million ($ 1.6 million) may be imposed.

Among other things, such penalties may be imposed for transferring such data abroad, processing it there or providing it to foreign law enforcement agencies without the permission of the Chinese authorities. The law will come into force on September 1.

Experts see the law as the desire of the Chinese authorities to control information more tightly and track it from the point of view of national security perceptions, and another blow to technology companies, as well as part of the program to develop the data center system and work with data in the country. According to Caroline Bigg, an intellectual property and technology lawyer at law firm DLA Piper, the law is “another important piece of the overall data protection regulatory puzzle in China.”

Yana Rozhdestvenskaya

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