Cybersecurity Law sparks data concern for MNCs

July 31, 2015 | BY

CLP Temp

China's draft Cybersecurity Law, which restricts cross-border data transmissions and requires the setting up of servers in the country, has prompted foreign companies to assess risks regarding delay, disclosure and costs

China's first comprehensive Cybersecurity Law, unveiled on July 6, extends far beyond cyberspace and makes it clear that the authorities want control over all segments that can lead to information security risks, including data storage and migration.

The draft, officially called the PRC Network Security Law, contains guidelines for the notification of data breaches, grading of information security systems as well as screening and regulation of encryption products. It also sets requirements that restrict cross-border data flows, which can disrupt the operations of businesses in multiple jurisdictions. Comments are due August 5 2015.

This comes on the back of the controversial PRC National Security Law, which subjects certain foreign investments, key technology and internet products and services to similar controls.

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