New list to aid outbound data flows

The general data list of cross-border data released by the Lin-gang Special Area of China (Shanghai) Pilot Free Trade Zone on Friday will facilitate outbound data flows by companies and contribute to high-quality economic development, executives and experts said.

Designated data used in three sectors — intelligent connected cars, mutual funds and biomedicine — have been allowed for cross-border flows under regulation, according to the list, the first of its kind rolled out in the country.

The list marks a major step forward after management rules for cross-border data flows were released in Lin-gang in February, classifying cross-border data into core data, important data and general data.

According to the management rules, general data are permitted for free cross-border flows following advance applications by users to the Lin-gang administration.

Core data is banned from cross-border transmission, while the cross-border flows of important data require security assessments in advance.

Companies registered in Lingang, or the remaining area of the Shanghai FTZ, can apply for general data cross-border flow services as long as the data transfer activities are conducted in Lingang.

The list, which will be initially applicable for one year, is further divided into 11 data application scenarios.

Specifically, data of intelligent connected carmakers concerning cross-border production and manufacturing management, research and development for design purposes, diagnostic data for global after-sales services, and maintenance information for secondhand cars across the world, have been included in the new list.

Yin Dan, chief information officer of SAIC Volkswagen, said the company has significant outbound data demand regarding vehicle warranty, maintenance, fault diagnosis and spare parts orders.

The list has addressed most of its demands and will lower its data compliance costs, he said.

With respect to biomedicine companies, five scenarios including de-identified study participant basic personal information in clinical trials and R&D, information on product complaints and contract management information for business partner management have been permitted for cross-border data flows under the new list.

Liu Bing, head of digital technology at Haleon China, said that data exports in the pharmaceutical industry have strong public interest attributes and are extremely dependent on international cooperation.

The scenario-based general data list has taken into full account the actual needs of most pharmaceutical companies while safeguarding data security and personal privacy, she said.

Mutual fund companies' industry research reports, macroeconomic analysis reports, supplier management data and risk management data have all received the green light for cross-border data flow under the new list.

According to asset manager Fidelity International, the new list can prevent repetitive investments by multinational asset management companies, lower communication costs and improve operational efficiency.

This is part of China's efforts to advance high-standard opening-up as more foreign financial institutions have entered the country, the company said.

Lu Sen, head of the data department of the Lin-gang administration, said the list has helped companies with the precise identification and compliance of data flow, which were major hurdles earlier.

However, it does not mean that all other cross-border data transfers are banned. The list will be extended over time, preparing for a negative list for cross-border data flows in the future.

Efforts will be made to extend the list to cover international trade financing letter of guarantee, international trade settlement letter of credit businesses, reinsurance and shipping businesses, Lu said.

Shen Yi, a professor of international politics at Fudan University, said the new list is quite exceptional from a global perspective, and has provided a limited white list that will serve economic development needs based on real business scenarios.

"Cross-border data flows are the prerequisite for industry development now. But the compliance cost for such activities cannot be overwhelming for companies. The new list, which is down-to-earth and elastic, can play an important role in stimulating economic growth. It is also a good choice to make such an experiment in Lin-gang," he said.

shijing@chinadaily.com.cn