China's internet regulator tries to ease concerns of foreign firms on new data rules - report
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The Cyberspace Administration of China is reaching out to foreign companies to discuss ways to navigate the country's new data-security laws, in an effort to dispel fears of multinationals about their ability to operate in the nation under the new rules, Bloomberg News reported.
Officials from China's internet regulator met with executives from several global companies to ease worries on new data regulations ahead of a November deadline for implementation, the report cited people with knowledge of the matter.
Walmart (WMT) PayPal (PYPL) and U.K.-backed English learning institution BC Education were among the companies that had a discussion with the agency, according to the report.
Regulators fielded questions from the companies and also offered guidance on how to comply with the rules and acknowledged the challenges of gaining approvals for overseas transfers of sensitive information. They also talked about creating a fast-approval mechanism for routine transfers, and curated so called 'white-list' for data categories or even specific companies, the report added.
The companies also showed concerns about a rule which requires sharing data with regulators during the approval process, potentially forcing them to reveal internal security procedures.
The new rules gives regulators the power to shut down or penalize companies which leak or mishandle sensitive information. Penalties include fines and suspensions.
The new data regulations are aimed to exercise control over vital information which powers the economy and future technologies. However, it has brought worries of disrupting the free-flow of information which companies require to operate worldwide, steer research and make a long-term strategy.
In some cases companies have already acted. Law firm Dentons split off its Chinese operations, while Morgan Stanley (MS) moved over 200 technology developers â about a third of its tech group â out of mainland China.
The State Council, China's cabinet, vowed over the weekend to streamline data transfers in a 24-point plan intended to mitigate concerns of multinational companies operating in the world's second largest economy.
The cabinet on Aug. 13 published a policy document on measures to improve foreign investment environment and efforts to attract foreign investment. Suggestions include strengthening policy support, and service guarantees, as welll as promote early signing, start, and production of foreign-funded projects.
The Chinese government will also help Beijing, Shanghai, Tianjin and the Greater Bay Area which includes Hong Kong make a list of general data which can be freely exported.
Multinationals in the area of technology, consumer, auto and finance have made a mark in the country.
Apple (NASDAQ:AAPL), Intel (NASDAQ:INTC), General Motors (GM), Tesla (TSLA), Starbucks (SBUX) and JPMorgan Chase (JPM), are some of the many prominent names from foreign soil that have extensive operations in China.

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