In the News: Data Transfer Rules Loosened; Kyndryl Splits China Business; and Shenzhen Finances Tech Companies

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China Relaxes Some Data Transfer Controls

The Cyberspace Administration of China (CAC) plans to allow businesses to freely transfer certain types of data without the need for data export security assessments, Reuters reported on Sep 28, 2023.

Under the Provisions for the Regulation and Promotion of Cross-Border Data Flows (Draft for Comments) （规范和促进数据跨境流动规定 (征求意见稿)), types of data that no longer require security assessments include "international trade, academic cooperation, cross-border manufacturing and marketing that do not contain personal information or important data." Security assessments are also waived for "cross-border shopping, hotel reservation or visa processing activities that require personal information to be transferred abroad, and also for employment purposes." Members of the public can comment on the proposed changes until Oct 15, 2023, the CAC added.

The planned changes will be a relief to many foreign businesses that are worried about the difficulty of complying with China's vague data transfer rules and the harsh punishments that come with breaching them. CLP previously reported on the measures some foreign firms have taken to comply with the data rules. For instance, CLP previously reported that Tesla opened a new Gigafactory in China to avoid the need to share sensitive design and manufacturing information across borders and comply with Chinese data regulations.