Will China’s New Internet Surveillance Law Affect U.S. Companies?

China's new Internet surveillance lawConfession: We’re covering this news a bit late. But since international Internet law issues are a concern of this blog, let’s hop in the DeLorean and travel back a few weeks to quickly review China’s latest online surveillance statute. Will this new overseas Internet law affect U.S. businesses?

What’s The Crux of China’s Internet Surveillance Law?

Websites and Internet providers operating in China must now “surveil and retain user communications.” Failing to do so will result in severe fines. Here are the primary points:

  1. Companies must store collected data in China.
  2. Businesses must perform security checks for finance and communications entities.
  3. Users must use real names on messaging services.

Why Did China Pass A Strict Internet Surveillance Law?

If countries’ Internet laws were compared to nannies in the movies, China would be a pre-Maria Captain Von Trapp compared to the U.S.’s Swell Crandell.

Some speculate that Chinese legislators raised the reconnaissance bar after Edward Snowden asserted: “Foreign technology firms could help governments spy.” Moreover, party officials have affirmed that strong monitoring programs protect against terrorism and other cyber attacks.

Why Aren’t Business Owners Thrilled With China’s Internet Surveillance Law?

Regulations spawn compliance standards, and retrofitting companies requires money. So, as you might imagine, businesses aren’t thrilled with China’s new Internet law.

Other interested parties were nonplussed with the law’s roll-out and vague wording, arguing that the bill’s hazy language may invite draconian oversight. Moreover, officials allegedly only released “less than half” of the implementation specifics, leaving folks unsure about compliance standards.

Is China Making a Mistake By Implementing Such A Strict Internet Surveillance Law?

Time, of course, will tell — but many market analysts seem to think China is cutting off its regulatory-nose to spite its global-commerce-face. In a time when Chinese businesses are trying to court American e-commerce operations, this new statute may prove counterproductive.

Will China’s New Internet Law Affect U.S. Companies?

Maybe. If a company has a presence in China — or operates a website accessible in China — then yes, they must follow the new law. It’s probably wise for any English-speaking website that focuses on Chinese news to mind the statute as well.

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Kelly / Warner is a full-service legal practice with considerable international Internet law experience. If you are grappling with an international Internet law matter, let’s chat.

Article Sources

Wee, S. (2017, May 31). China’s New Cybersecurity Law Leaves Foreign Firms Guessing. Retrieved July 10, 2017, from https://www.nytimes.com/2017/05/31/business/china-cybersecurity-law.html?_r=0

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