China’s principal internet regulator, the Cyberspace Administration of China (“CAC”), announced this week that China will move forward new legislation to combat the improper collection, use, and sale of personal information. The new legislation, announced during an interview of a senior CAC official by state-owned Xinhua News, is reportedly being drafted by CAC, the Ministry of Industry and Information Technology (“MIIT”), and the Ministry of Public Security (“MPS”).  A draft has not yet been released.

CAC, the country’s top cyberspace gatekeeper (and a dual-hatted Party/government organ), was established in 2011 by China’s State Council to streamline and strengthen internet regulation. Due to the lack of adequate enforcement resources, one of CAC’s key responsibilities is to coordinate with different ministries on internet-related matters and supervise and provide guidance to other ministries, including MIIT.  Among other things, internet data breaches fall under CAC’s broad jurisdiction.

China does not have a comprehensive personal information protection law, and more than a dozen patchwork and industry-specific sets of rules have been promulgated in recent years.  A more comprehensive draft Personal Information Protection Law, drafted by scholars in 2006 and submitted to the State Council in 2008, has not moved forward.  In the last two years, several delegates to the National People’s Congress have called for a comprehensive law to unify the country’s disparate personal information protection rules.  While the fate of such a comprehensive law is unclear, there are increasing signs that the Chinese government will enact additional legislation and regulations in the not-too-distant future regarding how businesses collect, use, protect, and transfer personal information.

Material for this post was supplied by Sheng Huang of Covington & Burling LLP.

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Photo of Eric Carlson Eric Carlson

Eric Carlson has nearly two decades of experience advising clients operating in China and other jurisdictions in Asia on compliance and investigations matters, particularly in the areas of corruption/FCPA/fraud and export controls/sanctions.

Having lived in China for more than a decade, he has …

Eric Carlson has nearly two decades of experience advising clients operating in China and other jurisdictions in Asia on compliance and investigations matters, particularly in the areas of corruption/FCPA/fraud and export controls/sanctions.

Having lived in China for more than a decade, he has deep experience leading highly sensitive investigations in China and other jurisdictions in Asia, including investigations presenting complex legal, political, and reputational risks. He speaks Mandarin and Cantonese and has led more than four hundred witness interviews in Chinese in 24 provinces in China, and conducted dozens of trainings in Chinese. He is a Certified Fraud Examiner.

Eric also counsels clients on the compliance risks of proposed transactions, conducts compliance due diligence as part of mergers, acquisitions, and joint ventures, assists companies in updating and strengthening their internal compliance programs and tailoring them to the unique features of Asian markets, and developing and presenting tailored compliance training in Chinese and English. Eric has advised scores of companies and organizations representing nearly every major industry.

Eric is a regular speaker on China-related compliance issues. He has been quoted in publications such as The Wall Street Journal, The Economist, The Financial Times, Global Investigations Review, Compliance Week, FCPA Report, The Corporate Treasurer, Commercial Dispute Resolution, China Business Law Journal, and Economy and Nation Weekly and was a contributing editor to the FCPA Blog. Chambers notes that Eric has “much more than just a conversational grasp of the language, but the ability to conduct interviews on specific subject matter details and get to the root of the issues.” Chambers further notes that “his language skills are very impressive” and that he provides “great advice that is grounded in reality,” adding: “They know the industry and their advice is very risk-based and balanced.” One client noted to Chambers: “They have strong regional coverage both in terms of footprint as well as language skills. If I have a compliance investigation in region with a tight timeframe, I know they can get it done. They take a more realistic approach to scoping investigations.” Other clients noted to Chambers that Eric is “really brilliant” and “an expert in this field.” According to one client surveyed by Chambers, “he is particularly adept at ‘right sizing’ the scope of an investigation to get at the key issues without incurring unnecessary operational or financial burden. He is also incredibly responsive to client communications.”

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Photo of Ashwin Kaja Ashwin Kaja

With over a decade of experience in China, Ashwin Kaja helps multinational companies, governments, and other clients understand and navigate the complex legal and policy landscape in the country. He plays a leading role in Covington’s China international trade and public policy practices…

With over a decade of experience in China, Ashwin Kaja helps multinational companies, governments, and other clients understand and navigate the complex legal and policy landscape in the country. He plays a leading role in Covington’s China international trade and public policy practices and, outside of Covington, serves as the General Counsel of the American Chamber of Commerce in China.

Ashwin helps clients solve acute problems that arise in the course of doing business in China and position themselves for longer-term success in the country’s rapidly evolving legal and policy environment. He is an expert on Chinese industrial policy and has worked on matters related to a wide range of sectors including technology, financial services, life sciences, and the social sector. Ashwin has also counseled a range of clients on data privacy and cybersecurity-related matters.

As the General Counsel of the American Chamber of Commerce in China (AmCham China), Ashwin serves as a senior officer of the organization and as an ex officio member of its Board of Governors, supporting nearly one thousand member companies in developing their businesses in China and advocating for their needs with China’s central and local governments.

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