Beijing, 15th November 2023
The European Chamber of Commerce in China (EUCCC) today released a survey on the impact of China’s data regulations on European business, that provides an overview of the areas where further steps are needed to optimise the country’s regulatory framework for cross-border data transfers.
China’s regulatory authorities and standard-setting bodies have long been in the process of improving the protection of personal information and important data. However, with many of the relevant laws, guidelines and measures lacking specificity, and with some requirements being overly stringent, European companies operating in China still face serious operational and compliance challenges.
The findings of the survey show that the overwhelming majority (96%) of European companies’ cross-border data transfers are internal transfers to the companies’ headquarters (HQs) or other regional offices, therefore the associated risk for data protection is relatively low. However, the impact of existing data regulations can be significant, with many companies – or at least some of their entities – obliged to undergo the regulatory security assessment (30%), bearing increased compliance costs (59%) and facing pressure to localise their data, information technology (IT) systems or operations altogether (41%).
The Chinese Government and relevant authorities seem to have already recognised the concerns put forward by businesses, as in the latter half of 2023 they issued guidelines and draft provisions aimed at addressing some of them. Companies are now waiting for these positive signals to be translated into action.
“It is positive that China’s relevant authorities are signalling an intent to optimise the country’s data regulations”, said Stefan Bernhart, vice president of the European Union Chamber of Commerce in China. “European businesses hope to see more clarity on related terms, and that their legitimate business needs are taken into consideration for sectoral rules as well as for compliance timelines.”
Download the report here.