Just before the Chinese cyber company warned Didi to reduce its special investment of $ 4.4bn in New York, security officials in the country began preparing their legal weapons to deal with another threat from the US.
In March 2018, the US enacted the Cloud Act, allowing prosecutors to request information stored outside their territory. Later that year, Canada built Meng Wanzhou, Huawei’s chief financial officer and daughter of the founder, following a US request. U.S. courts have forced HSBC to provide evidence on Meng’s bank account.
As tensions between the US and China escalate, lawmakers close to Beijing officials say a series of events in 2018 highlighted a high level of security in Chinese politics, including information and national security. Beijing rushed to establish legal barriers against what it sees as “long-handed” tactics used by foreign governments to obtain information.
The advent of China’s security services has boosted traditional business practices, such as the registration or transfer of data to other countries, in line with national security concerns. Lawyers warn that companies are being caught red-handed in the pursuit of corporate power, while companies say they are afraid of facing the wrong direction that disrupted Didi’s IPO.
“It’s 27 bears dominating one patch,” said Xu Ke, director of the internet law research center at the University of International Business and Economics in Beijing.
This month the Cyberspace Administration of China sent The Didi section is declining for days has released its $ 4.4bn public budget in New York and banned new users. The CAC has now established a mechanism that would allow voting for any company with more than 1m overseas users.
On Friday, seven government agencies put workers inside Didi to carry out what appears to be several months’ cyber security monitoring. It also registered the first announcement by China’s intelligence service, the Ministry of State Security, of the establishment of the company’s staff.
Didi’s case comes as China prepares a new Data Protection Act, which increases the amount of goods that cannot be exported outside China without a permit. The drafting of the order, which will be implemented in September, was forced by the Ministry of Defense, according to a number of people familiar with the matter.
“It is a legitimate way to combat the misuse of long-standing international and foreign countries – and it protects the names of our communities from being misidentified by foreign agencies or foreign regulators,” the CAC said in a Data Security Law statement.
China’s concern for data security is not unique: its enemies think the same. In 2019, the US imposed trade sanctions on Huawei. The following year, the US threatened to ban TikTok, while India banned China’s phones. All of these punishments were carried out in the name of national security.
“In the meantime, all law enforcement agencies are working hard to be more vigilant [around national security]. It is a problem of the change of mindset from external objects to home, as well as from above [of the government] to the ground, ”said Li Tianhang, an online security lawyer at the Hui Ye Law Firm in Beijing.
Disputes over international law can put foreign countries at risk. According to the Hong Yanqing newspaper, the main author of data protection laws in China, China, the EU and the US are forming unions to “close and seize data”, and foreign countries are being caught in a “legal game”.
Beijing’s growing awareness has led some of its organizations to do more. Following Didi’s investigation, the undisclosed CAC offered the right idea to force all companies with more than 1m users seeking foreign IPOs, giving them the opportunity to start a Chinese specialty, whose funds from the USD search for New York leave.
However, the CAC’s ability to do arithmetic is limited. The forum was set up in 2014 primarily to monitor online discussions, and in particular works with former fraudsters. His focus on data security is recent; the forum serves as an intermediary between various powerful institutions.
“The local CAC branch is not very aware of the new rules and how to apply them,” said a data security official with Guangdong’s financial services company. “Sometimes they refuse to ask us to review it because they do not understand what seems to be a difficult issue.”
But since the law forced the company to comply with the policy, the police added, his company is starting to send data to the agency through registered letters so that there is no alternative to the agency.
Following Didi’s trial, however, attorneys and former officials expected the agency to change from business executives to state security forces.
“Once there is an element of national security, it is difficult for some regulators to say anything. “No one wants to be a threat to national security,” said one expert on regulators.
Additional reports of Nian Liu
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