No Result
View All Result
SUBSCRIBE | NO FEES, NO PAYWALLS
MANAGE MY SUBSCRIPTION
NEWSLETTER
Corporate Compliance Insights
  • Home
  • About
    • About CCI
    • Writing for CCI
    • NEW: CCI Press – Book Publishing
    • Advertise With Us
  • Explore Topics
    • See All Articles
    • Compliance
    • Ethics
    • Risk
    • FCPA
    • Governance
    • Fraud
    • Internal Audit
    • HR Compliance
    • Cybersecurity
    • Data Privacy
    • Financial Services
    • Well-Being at Work
    • Leadership and Career
    • Opinion
  • Vendor News
  • Career Connection
  • Events
    • Calendar
    • Submit an Event
  • Library
    • Whitepapers & Reports
    • eBooks
    • CCI Press & Compliance Bookshelf
  • Podcasts
  • Videos
  • Subscribe
  • Home
  • About
    • About CCI
    • Writing for CCI
    • NEW: CCI Press – Book Publishing
    • Advertise With Us
  • Explore Topics
    • See All Articles
    • Compliance
    • Ethics
    • Risk
    • FCPA
    • Governance
    • Fraud
    • Internal Audit
    • HR Compliance
    • Cybersecurity
    • Data Privacy
    • Financial Services
    • Well-Being at Work
    • Leadership and Career
    • Opinion
  • Vendor News
  • Career Connection
  • Events
    • Calendar
    • Submit an Event
  • Library
    • Whitepapers & Reports
    • eBooks
    • CCI Press & Compliance Bookshelf
  • Podcasts
  • Videos
  • Subscribe
No Result
View All Result
Corporate Compliance Insights
Home Cybersecurity

Gaining Clarity on the Impact of the New PRC Cybersecurity Law

by Wendy Wysong
October 25, 2017
in Cybersecurity, Data Privacy, Featured
legal paperwork

How China’s New Cybersecurity Measures Will Affect Multinational Companies

Multinational companies with operations in China are preparing for the impact of China’s new Cybersecurity Law, in place now for four months. The Law applies to everyone who operates networks in the PRC, particularly multinational corporations. This could impact their overall IT system set-up and global outsourcing. Also left open to question is how their Chinese offices, particularly in a sensitive sector, will be able to share business data with other offices. And of great concern to multinational companies and their advisors is how to adapt internal and regulatory investigations to avoid triggering the Cybersecurity Law.

with co-authors Lei Shi and Tina Wu. 

The Cybersecurity Law of the People’s Republic of China took effect on 1 June 2017. The Law states that China will take steps to monitor, defend, and address cybersecurity risks and threats originating from within and outside China. It applies to the construction, operation, maintenance and use of networks as well as the regulation of cybersecurity within the PRC. It applies to both internet and individual intranets as long as there is any network-related activity taking place in the PRC.

The Cybersecurity Law distinguishes between “Network Operators” and “Critical Information Infrastructure Operators (“CIIOs”).”Network operators” are very broadly defined and thus may cover any business which operates a website or an intranet or provides any service through a network.

In contrast, CIIOs refer to a narrower group of operators. While there has been no definitive guidance on what constitutes a CIIO, it is understood that they include organizations in specified priority industries such as healthcare, utilities and online government services. Crucially, the financial sector is also included. CIIOs are subject to additional security, procurement and other restrictions. For example, CIIOs must carry out an assessment of their facilities’ cybersecurity at least once a year and report potential risks and proposed remediation measures to the authorities. In addition, they must also ensure that any network products and services they purchase that might influence national security undergo a security review carried out by the Cyberspace Administration of China (CAC).

Data Protection

The Cybersecurity Law and its subsidiary regulations focus heavily on the protection of personal information and important data.

Personal information protected under the Cybersecurity Law includes all types of information recorded electronically that may identify a natural person, including, for example, names, dates of birth, telephone numbers and addresses. There are requirements for fair and lawful processing, obtaining consent for the collection, use and disclosure and technical measures to ensure data security. There is an exception for the processing of personal data on an anonymized basis for statistical purposes.

Important data, which is similarly subject to enhanced protection, is less clearly defined. Data of anonymized personal information, which falls outside the definition of “personal information,” may constitute important data. Important data does not have to be state secret either. There will continue to be ambiguity pending further clarification by regulators.

Cross-border Transfers

Under the Cybersecurity Law, personal information and important data collated by CIIOs must be stored within Mainland China, and any cross-border transfer is subject to a security review.

Draft measures published in April 2017 suggested that both network operators and CIIOs would be subject to similarly stringent data export restrictions. After industry consultation, a later published draft appeared to relax certain restrictions on non-CIIO network operators.

Further Changes

The CAC has recently published a series of rules in an attempt to regulate the acts of internet users and comments posted on social media, internet forums and communities. These guidelines became effective earlier this month (October 2017). It is expected that further measures will follow such as requiring notice and consent to the use of cookies and a draft e-commerce law, providing greater protection for user data.

Pending the publication of more detailed rules (especially those on data export), the full impact of the Cybersecurity Law on multinational corporations and financial institutions is uncertain. Developments should be monitored closely and affected companies and institutions should take an active part in consultations organized by the PRC regulators. In the meantime, it is wise to prepare for a greatly expanded compliance burden.


Tags: Data Governance
Previous Post

Thomson Reuters Expands its Connected Risk Platform to Help Firms Increase Efficiency

Next Post

TRACE: The Outlaw Ocean

Wendy Wysong

Wendy Wysong

Wendy L. Wysong is a partner at Steptoe & Johnson. She served previously as a litigation partner with Clifford Chance, offering clients advice and representation on compliance and enforcement under the Foreign Corrupt Practices Act, the Arms Export Control Act, International Traffic in Arms Regulations, Export Administration Regulations, and OFAC Economic Sanctions. She was appointed by the State Department as the ITAR Special Compliance Official for Xe Services (formerly Blackwater) in 2010. Wendy combines her experience as a former federal prosecutor with the United States Attorney for the District of Columbia for 16 years with her regulatory background as the former Deputy Assistant Secretary for Export Enforcement at the Bureau of Industry and Security, U.S. Department of Commerce. She managed its enforcement program and was involved in the development and implementation of foreign policy through export controls across the administration, including the Departments of Justice, State, Treasury and Homeland Security, as well as the intelligence community. Wendy received her law degree in 1984 from the University of Virginia School of Law, where she was a member of the University of Virginia Law Review.

Related Posts

banks information sharing_f

Sharing Is Caring? Lessons From Dutch Banks’ Data-Sharing Program

by Sukirt Singh
March 22, 2023

With federal investigations pending, the autopsy of Silicon Valley Bank and resulting cascade of bank failures is only just beginning....

risk tunnel

From Regulation to Volume, There Is No Light at the End of the Data Privacy Tunnel

by Jim DeLoach
March 15, 2023

Data proliferation and data privacy regulatory activity across the globe have created the need for focused boardroom discussions. An underpinning...

data breach

Sobering Reality: Drizly Order Indicates Officers May Face Personal Liability for Data Breaches

by Baker Donelson
February 1, 2023

The FTC says Drizly’s CEO James Cory Rellas was alerted to a potential security loophole two years before a data...

minidata_b

Honey, I Shrunk the Data: How to Keep Customer Info on a Need-to-Know Basis

by Parker Poe
November 30, 2022

It may be tempting to hoard the data you have gathered on your customers, but an increasing number of regulations...

Next Post
Ship floating in the ocean

TRACE: The Outlaw Ocean

Compliance Job Interview Q&A

Jump to a Topic

AML Anti-Bribery Anti-Corruption Artificial Intelligence (AI) Automation Banking Board of Directors Board Risk Oversight Business Continuity Planning California Consumer Privacy Act (CCPA) Code of Conduct Communications Management Corporate Culture COVID-19 Cryptocurrency Culture of Ethics Cybercrime Cyber Risk Data Analytics Data Breach Data Governance DOJ Download Due Diligence Enterprise Risk Management (ERM) ESG FCPA Enforcement Actions Financial Crime Financial Crimes Enforcement Network (FinCEN) GDPR HIPAA Know Your Customer (KYC) Machine Learning Monitoring RegTech Reputation Risk Risk Assessment SEC Social Media Risk Supply Chain Technology Third Party Risk Management Tone at the Top Training Whistleblowing
No Result
View All Result

Privacy Policy

Founded in 2010, CCI is the web’s premier global independent news source for compliance, ethics, risk and information security. 

Got a news tip? Get in touch. Want a weekly round-up in your inbox? Sign up for free. No subscription fees, no paywalls. 

Follow Us

Browse Topics:

  • CCI Press
  • Compliance
  • Compliance Podcasts
  • Cybersecurity
  • Data Privacy
  • eBooks Published by CCI
  • Ethics
  • FCPA
  • Featured
  • Financial Services
  • Fraud
  • Governance
  • GRC Vendor News
  • HR Compliance
  • Internal Audit
  • Leadership and Career
  • On Demand Webinars
  • Opinion
  • Resource Library
  • Risk
  • Uncategorized
  • Videos
  • Webinars
  • Well-Being
  • Whitepapers

© 2022 Corporate Compliance Insights

No Result
View All Result
  • Home
  • About
    • About CCI
    • Writing for CCI
    • NEW: CCI Press – Book Publishing
    • Advertise With Us
  • Explore Topics
    • See All Articles
    • Compliance
    • Ethics
    • Risk
    • FCPA
    • Governance
    • Fraud
    • Internal Audit
    • HR Compliance
    • Cybersecurity
    • Data Privacy
    • Financial Services
    • Well-Being at Work
    • Leadership and Career
    • Opinion
  • Vendor News
  • Career Connection
  • Events
    • Calendar
    • Submit an Event
  • Library
    • Whitepapers & Reports
    • eBooks
    • CCI Press & Compliance Bookshelf
  • Podcasts
  • Videos
  • Subscribe

© 2022 Corporate Compliance Insights

Welcome to CCI. This site uses cookies. Please click OK to accept. Privacy Policy
Cookie settingsACCEPT
Manage consent

Privacy Overview

This website uses cookies to improve your experience while you navigate through the website. Out of these, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may affect your browsing experience.
Necessary
Always Enabled
Necessary cookies are absolutely essential for the website to function properly. These cookies ensure basic functionalities and security features of the website, anonymously.
CookieDurationDescription
cookielawinfo-checbox-analytics11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Analytics".
cookielawinfo-checbox-functional11 monthsThe cookie is set by GDPR cookie consent to record the user consent for the cookies in the category "Functional".
cookielawinfo-checbox-others11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Other.
cookielawinfo-checkbox-necessary11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookies is used to store the user consent for the cookies in the category "Necessary".
cookielawinfo-checkbox-performance11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Performance".
viewed_cookie_policy11 monthsThe cookie is set by the GDPR Cookie Consent plugin and is used to store whether or not user has consented to the use of cookies. It does not store any personal data.
Functional
Functional cookies help to perform certain functionalities like sharing the content of the website on social media platforms, collect feedbacks, and other third-party features.
Performance
Performance cookies are used to understand and analyze the key performance indexes of the website which helps in delivering a better user experience for the visitors.
Analytics
Analytical cookies are used to understand how visitors interact with the website. These cookies help provide information on metrics the number of visitors, bounce rate, traffic source, etc.
Advertisement
Advertisement cookies are used to provide visitors with relevant ads and marketing campaigns. These cookies track visitors across websites and collect information to provide customized ads.
Others
Other uncategorized cookies are those that are being analyzed and have not been classified into a category as yet.
SAVE & ACCEPT