Beijing approves the new privacy law, against the abuses of tech giants

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August 20, 2021 China has approved a strict privacy law, in force since November 1, to prevent companies from collecting sensitive personal data, against the increase in internet fraud, data leakage and abuses alleged by technology giants and of the web on the personal information of customers.

According to the rules approved by the Standing Committee of the National People's Assembly, legislative branch of the Chinese parliament, state and private companies that handle personal information must reduce data collection and have user consent. State security apparatuses will keep access to personal data. 

The new rules are configured as a further blow to the Chinese technology sector, where Didi and Tencent are the last major players to have ended up in the crosshairs of the authorities in recent months for the misuse of personal data. 

The law, modeled on the General Data Protection Regulation of the European Union, among the most stringent in the world for the online sector, aims to protect those who "are most exposed to risks on personal data used for user profiling and algorithms. of recommendation or the use of big data in the determination of unfair prices, "a spokesman for the National People's Assembly told the state news agency Xinhua. 

For example, businesses won't be able to set different prices for the same service based on customers' tracked purchase history, which is a common practice among Chinese online businesses. The personal data of Chinese citizens cannot be transferred to countries with lower security standards than China, constituting a serious problem for foreign companies, starting with US ones.

Companies that fail to comply can face fines of up to 50 million yuan ($ 7.6 million) or five percent of annual revenue. Serious offenders also risk losing business licenses and being forced to close. 

Sensitive personal data includes information that, if leaked, can lead to "discrimination or seriously threaten the safety of individuals," including race, ethnicity, religion, biometric data, or where a person is located - a definition that conflicts with the Chinese cities littered with surveillance cameras and facial recognition equipment, which collect biometric information on a daily basis.