China: CAC reviews security of big tech companies

China: CAC reviews security of big tech companies

Beijing, Jan. 10, 2022

China’s Cyberspace Administration (CAC) announced that all technology companies with information on at least one million people will have to participate in a security review from February 15 before going public overseas.

Companies will only be allowed to go public if the CAC determines that their data processing activities do not pose a threat to China’s national security.

China’s personal data protection law took effect Nov. 1. The law requires the CAC to approve cross-border data transfers. Foreign companies must have an agency or employee in China to monitor compliance with the law.

Companies that do not comply with the law can be fined $7.5 million, or 5% of their previous year’s revenue. It is unclear whether companies that want to go public in Hong Kong will have to undergo a review.