What’s new: Nearly 30% of German companies in China have made moves to meet China’s cross-border data transfer requirements, a survey by the German Chamber of Commerce in China finds.
The survey, which looked at 169 companies between Nov. 30 and Dec. 8, showed that 7% of the German enterprises studied have submitted materials regarding data export practices to Chinese authorities for compliance reporting, while 23% are preparing to do so.
Another 38% surveyed believe there is no obligation to report and the remaining 32% abstained citing reasons ranging from a mismatch between survey options and their actual conditions, to a lack of understanding of the policy.
Of the 12 companies that have submitted reporting materials, one said it has received clearance and two have been partially green-lighted, the survey showed.
The German chamber's survey found that challenges faced by those filing materials included difficulties in understanding the latest progress in review stages and unclear rectification requirements. Some companies mentioned issues such as“short rectification deadlines,” “lengthy review times,” “high time costs,” and “operational difficulties." A quarter of businesses said they met with no problems.
Background: China has stepped up efforts to protect data security in recent years, setting up a legal regime for data exports. Starting in 2022, companies seeking to transfer data overseas must apply for a security assessment from the country’s top cybersecurity watchdog if they trigger regulatory thresholds.
Some foreign businesses in China have expressed concerns over the tightened data rules. In November, the European Union Chamber of Commerce in China called on Beijing to clarify cross-border data transfer regulations it considers too vague or too strict, as they have increased costs for companies doing business in China.
After a visit to Beijing in December, European Union President Ursula von der Leyen said China has agreed to set up a mechanism to clarify the rules.
Contact reporter Han Wei (weihan@caixin.com)
Get our weekly free Must-Read newsletter.
