There’s been a great deal of talk concerning cybersecurity rules recently issued by Chinese officials. These rules greatly concern American businesses who wish to avoid the surrendering of trade secret information and other confidential materials.
Such concerns are understandable. This is because a company’s intellectual property may be its most valuable asset. According to a South China Morning Post article, the new rule took effect on Nov. 1. This new rule allows Chinese security personnel to enter the premises of companies and copy what they feel is relevant cybersecurity information.
Implementation of the new rule
Unfortunately, not much is known about enforcement of the new rule. Such lack of transparency will create difficulties for American businesses.
According to some analysts, that’s not atypical regarding how Chinese officials generally pass such legislation. “First there is a big concept, then there is a sweeping law, and then implementing regulations will come in to flesh out the details,” said one expert pertaining to this matter.
The possible goal of the legislation is to prevent hacking. The express intent of the rule is to give notice regarding security vulnerability without disruption of network operations. But such a rule also allows for further implementation of surveillance and censorship.
The new rule allows for Chinese police to go to business sites and to internet service providers. The police will ask individuals at the business a number of questions while copying confidential information.
It is useful for companies to have on their side legal counsel who can advise regarding potential difficulties that companies may face. It is important to remember that Chinese have long conducted these sorts of inspections. Thus, the new rule is not actually anything new.
The issues with doing business in China is that businesses often have to deal with legislation that is ambiguous. This is especially true when it comes to protection of trade secret information.
American businesses that do not take the necessary precautions may find their trade secret information hacked. They may also find themselves on the wrong end of a Chinese ruling.