China Unveils New Rule to Crack Down on Moving Data and Information

China Unveils New Rule to Crack Down on Moving Data and Information

( – In recent months, the Chinese government has cracked down on the country’s technology and data storage, trying to ensure that information critical to national security isn’t compromised. However, a new law is quite vague and comes with hefty punishments, leaving many businesses unsure of how to proceed and comply with the government’s latest oversight measure.

The Data Security Law Goes Into Effect

On Wednesday, September 1, the Data Security Law went into effect, forcing all Chinese companies to label data as ordinary, important, or core data. Within each category, there are laws determining how companies must store the information, including where the company can transfer it and to whom.

The law defines ordinary data as having little ability to influence the Chinese economy, culture, and society, while important data poses a threat to such things. The law defines core data as something able to pose a “serious threat” to the country’s interests that could cause “large-scale shutdowns” if stolen or misused.

Currently, this is all companies have to go on, as the law did not provide specific examples of each type of data. However, it does say that failing to follow the new rules could mean a criminal charge or a 10-million-yuan fine.

Companies are Nervous as Investigations Begin

Right now, the Chinese Communist Party (CCP) is already investigating four businesses for national data security risks. The CCP’s cyberspace regulator started its Didi Global investigation just two days after the company opened in New York. The other businesses include an online recruitment platform and two commercial freight sites.

The new law also ensures companies store all data within China in an attempt to cut down on data theft and misuse. However, most companies see this as yet another form of government regulation and censorship, giving off the feeling that “Big Brother is Watching.”

Where Does Data Regulation Lead?

With the increasing cyberattacks both around the world and in the United States, many Americans wonder about the best way to protect our nation’s businesses and data from hackers that cripple companies and hurt the economy. While government regulation is one way to try and get ahead, the private sector is usually faster and more innovative when it comes to data and security solutions.

Hopefully, new Chinese data laws are a warning to Americans, highlighting what could happen down the road if government regulation is not limited as the world dives further into the technology age.

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