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New cyber security law may impact business in China

Many businesses operating in China understand the challenges that come from such a competitive marketplace. Staying relevant can be difficult, especially when it seems like the deck may be stacked against you. Rules and regulations change frequently, and sometimes they may have an adverse effect upon your ability to do business within the country.

A new rule in China is drawing a lot of scrutiny from business owners in the United States and Europe. The law concerns the storage of data, and requirements that businesses must meet when securing their data. This post discusses this rule, and what this might mean for companies looking to do business in China.

An overview of the new law

The proposed changes relate specifically to storing cyber data inside China. The law would require companies to keep this data stored in China, and make the data available for review periodically by Chinese officials.

The reason that China wants to be so protective of this data is because of the country’s feelings on “cyber sovereignty.” The country feels that any of the data that is created inside its borders should stay inside its borders, in order to be sure that end users are being protected.

Businesses in the U.S. and in other locations believe that this places an unusual burden on foreign companies. Being forced to comply with these rules could raise costs considerably, and make it much more difficult for companies to compete in the market. They believe that the laws go way too far, especially when compared with similar laws in their home countries.

What this means for you

Certainly, the more restrictions you and your business face, the more difficult it can be for you to remain competitive in the area. You need to stay ahead of these changes so that you are not caught by surprise. Failing to be prepared for new policies and procedures can have a lasting impact on the future of your company.

If you have questions about entering the Chinese marketplace, or about how certain laws may impact your business, you should consult an attorney experienced with the business climate in China to learn more about your options. An attorney who is familiar with the laws and regulations currently in effect in the country will help you understand what your business must do to comply with these rules.

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