A visitor takes photos of a screen monitoring the internet during an exhibition on cyber security in Shanghai in September 2017. Photo: VCG

China is planning to further tighten regulations on internet data storage, banning the transfer of data on domestic users overseas and asking domestic and foreign companies to provide data to regulators for national security purposes, said a new draft rule.

Coming at a time when China and the US are locked in an escalating trade and technology spat, the move could be seen as a countermeasure to the US crackdown on Chinese telecom firm Huawei, as the draft rules could affect US companies such as Google, Microsoft and Amazon, analysts said.

Citing the need to protect national security and users' personal information, the Cyberspace Administration of China (CAC) released the draft regulation on Tuesday that significantly tightens rules on how companies, foreign and domestic, should handle data generated in the country. The draft rules are open for public comment until June 28.

Specifically, the draft regulation states that companies cannot route domestic internet traffic outside the country. Operators should also assess potential security risks and seek permission from regulators before publishing, sharing, transacting or providing important data to the outside world, it said.

The regulation said that companies should provide data to relevant government agencies when approached by them for national security, social management, economic regulation and other duties.  

Such a move is necessary for China to safeguard its national security and in line with similar practices adopted by other major powers, including the US, Russia and the EU, said Liang Haiming, dean of Hainan University's Belt and Road Research Institute.

US officials have demanded data from internet companies such as Facebook, Google and Twitter under national security grounds. The infamous Prism program of the US National Security Agency also showed that US officials had direct access to data from internet companies. In Australia, a new law directly demands that internet firms must open what's known as a backdoor for Australian security forces to access encrypted data. 

The draft rules also shows China's firm stance on matters of national security despite pressure from the US in stalled trade talks, analysts said. US officials had reportedly pressured Chinese officials for concessions in granting US firms access to China's cloud computing market and relaxing restrictions on data storage.

The move could also be an effective way to counter the US' intensifying crackdown against Huawei, particularly after US companies such as Google decided to follow a US ban to cut supplies to Huawei, according to Liu Dingding, a Beijing-based internet analyst.

The new rules, which were published in line with the cybersecurity law, are aimed at bolstering protection of China's national security in line with the rule of law. But in light of the US crackdown on Huawei, it could also be a tool for Chinese officials to counter the US, analysts said.


Newspaper headline: China drafts tighter data storage rules