China reportedly warns local tech companies of increased cybersecurity oversight


China has reportedly warned local companies it will tighten oversight of data security and overseas listings days after unveiling Didi has been subject to a government cybersecurity review.

The State Council on Tuesday issued a statement indicating that it would crack down on the corporate sector across a range of areas, spanning from anti-trust to cybersecurity to fintech, Bloomberg said in a report.

As part of the statement, China reportedly said rules for local companies listing overseas would be revised and publicly-traded firms would be held accountable for keeping their data secure.

China also reportedly said it would step up its regulatory oversight of companies trading in offshore markets.

China’s lawmakers have already commenced its crackdown, having passed new data security laws last month to strengthen the government’s control over digital information. The newly passed laws provide a broad framework for future rules on internet services, such as how certain types of data must be stored and handled locally.  

The warning comes days after Didi was removed from app stores in China for breaching regulations relating to the collection and use of personal data, which occurred shortly after the company made its debut on the New York Stock Exchange.

Beyond Didi, other Chinese tech giants like Alibaba and Tencent have come under government scrutiny in recent months, with Alibaba being hit with a record 18.2 billion yuan fine. 33 other mobile apps have also been called out by Beijing for collecting more user data than deemed necessary when offering services.

With government oversight intensifying in China, tech companies, including Apple, Facebook, Google, and Twitter, have jointly warned that they could stop offering their services in Hong Kong if the government goes ahead with plans to amend privacy and doxxing laws.

The laws, if amended, would put the staff of companies at risk of being imprisoned while making digital platforms vulnerable to criminal investigations for doxxing posts made by the platforms’ users. The laws in question were proposed by Hong Kong’s Constitutional and Mainland Affairs Bureau in May as it said doxxing needed to be addressed due to it being prevalent against government members seeking to introduce an amendment Bill on extradition that led to the 2019 Hong Kong protests.

On the same day of China’s warning of increased tech oversight, Ministry of Foreign Affairs Deputy Director Zhao Lijian reportedly told local media that China would “not allow any country to reap benefits from doing business with China while groundlessly accusing and smearing China”.

While not mentioning Australia by name, Zhao said a “certain country” has been acting as a “cat’s paw for others” and that there are consequences associated with that, when asked about Australia’s loss of market share in China’s agricultural market.

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