Brief: Foreign companies might need permission to move data out of China soon

Cross-border ecommerce companies might need approval from the Chinese government to move customer data out of China if drafted regulations are passed. Photo credit: dedivan1923 / 123RF.

• Newly drafted rules released Tuesday would require foreign companies to apply for permission to transfer data out of China.
• The rules would apply to companies that want to move more than 1TB of data, or have data on more than 500,000 people.
• The drafted rules could change depending on feedback – it’s open for public commentary until May 11th.
• Multinational companies are usually opposed to data localization, as it can raise costs by requiring duplicate data centers and impeding cross-border business. China already imposes strict regulations on digital information – its ‘Great Firewall’ censorship mechanism blocks certain websites, such as Facebook. These newly drafted rules would further China’s cyber sovereignty, an idea championed by President Xi Jinping.

See: Death by a thousand cuts: software development behind China’s Great Firewall

Source: Wall Street Journal

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