Guangdong Province will ramp up efforts on data regulation by exploring the establishment of a “Data Customs”unit to review cross-border data flow and create a big data centre in the Guangdong-Hong Kong-Macao Greater Bay Area.
Guangdong is in South China and this development was announced on Sunday. This move needs to be seen in the context of China wanting to strengthen its cybersecurity regulations after its fallout with Didi Chuxing’s.
On July 5, Chinese cybersecurity regulator announced a review into the country’s top ride-hailing platform, Didi Chuxing. The announcement came less than a week after a flurry of regulations were imposed on internet platforms over data protection and monopolistic practices, according to a report by Global Times.
Establishment of Data Customs
The provincial government will support the construction of the Guangzhou Nansha (Guangdong-Hong Kong-Macao) Data Cooperation Pilot Zone and the Zhuhai Hengqin Guangdong-Macao Intensive Cooperation Zone, explore the establishment of a “Data Customs”, and carry out the review, evaluation and supervision of cross-border data flow, according to a notice released by the authorities of Guangdong on Sunday, which was reported by Global Times.
The proposed legislation on data in Shenzhen also includes the construction of a pilot demonstration zone for building socialism with Chinese characteristics, the promotion of capitalisation and supervision of data rights and interests, and the standardization of data collection, processing, application and quality management, the report added.
Other states in China have been also advocating for data legislation. According to local media Shanghai Observer, Shanghai has been actively promoting and is working to formally roll out new regulations on data this year.
A data centre for the Greater Bay Area and a data trading market are expected to be established in Shenzhen.
One of the reasons for local governments to up their ante on data regulation is due to increased efforts by Chinese authorities on data breaches, which has wreaked havoc across the world and which poses significant national and public security risks in case of a data leak.
China tightened cybersecurity requirements for Chinese companies with a set of draft rules on Saturday. These include a regulatory review for businesses in China that hold data of 1 million users or more before applying for an IPO overseas.
China is not alone in this effort. South Korea government-led MyData project, which was slated to be launched in August, aims to allow licensed service providers to collect and analyse personal data scattered across the finance sector.
Some corporations have also taken some data localisation measures. Recently, Tesla announced that it has set up a data centre in mainland China. The Electric Vehicle maker took this step after Chinese authorities, in March, restricted the use of Tesla cars by the military and employees of state-owned companies.