The Chinese government passed a new law regulating big tech companies Thursday. Together with a regulatory proposal updated by the National People’s Congress in April, the new policy represents increasing government oversight and regulation of the country’s growing tech industry, and foreign tech companies with operations in China.
Building on the 2017 Cybersecurity Law, China’s government is tightening its control over big data industries and companies like Tencent Holdings Ltd, Baidu, Inc., Alibaba Group, and TikTok owner, ByteDance, Ltd. The rules would apply to the collection, storage, use, and transmission of digital information created by tech platforms and their users.
Since last year, China has also required foreign tech companies like Apple and Tesla to comply with regulations to maintain data records in servers on Chinese soil, subject to Chinese rules and regulators.
Bottom Line: Last year a draft regulation released by the municipal authority of Shenzhen summarized the Chinese Communist Party’s view of data collected by big tech companies thusly: “Public data is a new type of state-owned asset, and its data rights belong to the state.” While world governments grapple with the opportunities and conflicts posed by the growth of big tech, China is charting its own, very historically Chinese path, of more centralized government command and control over digital industry.
