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Information/Technology

China Stepped up Control of Web Contents

China has been strengthening its overall supervision of cyberspace. On September 15, the Cyber Administration of China (CAC), the country’s top cyber regulator, released the “Opinions on Further Clarifying the Responsibilities of the Online Platform Operators in terms of Information Content.”

The CAC pointed out that the main purpose of releasing the “Opinions” was to focus on different indications of web chaos, and “to ensure that the online platform always adheres to the correct political direction, public opinion guidance and value orientation.”

The “Opinions” gives ten key tasks, including setting up online community rules, the preparation of lists and directories of illegal and unhealthy conduct, the establishment of user credit records and evaluation systems, and the maintenance of records on users’ violations.

The “Opinions” requires the online platforms to improve the content approval mechanism, implement the chief-editor’s responsible system, further expand the scope of manual audits, and establish a dynamic updating mechanism for the database of illegal activities.

Source: Cyber Administration of China, September 15, 2021
http://www.cac.gov.cn/2021-09/15/c_1633296790051342.htm

LTN: Wikipedia Permanently Banned Some Chinese Users

Major Taiwanese news network Liberty Times Network (LTN) recently reported that Wikipedia imposed an unprecedented permanent ban on seven Chinese users for their login rights and another twelve users for their management and editing rights since they were suspected of reporting Hong Kong Wikipedia editors to the Hong Kong National Security Agency. Since the outbreak of the campaign against the revised draft of the Fugitive Offenders Ordinance in Hong Kong in 2019, Wikipedia editors in Hong Kong and China have had political differences in their description of the situation in Hong Kong. After the HK National Security Law took effect last year, Wikipedia issued a statement that it will not share non-public user information with the Hong Kong government unless there is a clear legal requirement or an immediate life-threatening danger. Wikipedia is now banned in Mainland China.

Source: LTN, September 15, 2021
https://news.ltn.com.tw/amp/news/world/breakingnews/3672959

State-owned Enterprises Ordered to Migrate to State-owned Cloud Services

China’s national data security law went into effect on September 1, 2021. Just days before it became effective, the China State Council’s State-owned Assets Supervision and Administration Commission (SASAC) for Tianjin issued a directive mandating state-owned enterprises in Tianjin to accelerate data migration from cloud services of tech companies like Alibaba and Tencent to the state-owned infrastructure. Currently, Alibaba, Huawei, and Tencent dominate the cloud computing market in China.

In a directive dated August 12, 2021, Tianjin’s SASAC directed state-owned enterprises in Tianjin not to build new data centers, or purchase servers and other storage hardware. State-owned enterprises cannot renew or sign new contracts with cloud platforms owned by Huawei, Alibaba, Tencent, China Unicom, China Mobile, and China Telecom. Data stored in these platforms must be migrated to cloud platforms controlled by SASAC within two months of the expiration of existing contracts, with the final deadline being at the end of September 2021.

Section 3(3)(1) on page 7 of the SASAC directive reads, “The data of state-owned enterprises are state assets and must be put under state-owned assets supervision and administration…”

Since early 2021, local SASACs have started local state-owned cloud platform projects. The essence of “state-owned cloud” is to shift from a cloud platform hosted by a third party to a state-owned cloud built and operated by local state-owned enterprises. In March 2021, Tianjin state-owned cloud started operation, with three state-owned enterprises, including Tianjin Communications Group and Tianjin State-owned Capital Investment and Operation Co., Ltd. In March, the SASAC of Zhejiang Province also initiated a project that included a state-owned cloud platform. In April, SASAC of Sichuan Province officially kicked off its state-owned cloud platform.

Sources:

Lianhe Zaobao, September 4, 2021
http://www.haozaobao.com/shiju/20210904/99713.html

State-owned Assets Supervision and Administration Commission of Tianjin, August 12, 2021
http://www.d1net.com/uploadfile/2021/0827/20210827062000825.pdf

Yicai, September 7, 2021
https://www.yicai.com/news/101166263.html

China to Regulate Algorithms behind Internet Platforms

On August 27, 2021, the Cyber Administration of China, the country’s top Internet regulator, issued a draft version of the “Internet Information Service Algorithmic Recommendation Management Provision.”

“The use of algorithmic recommendation technology … refers to the use of generative or synthetic–type, personalized recommendation–type, ranking and selection–type, search filter–type, dispatching and decision-making–type, and other such algorithmic technologies to provide information content to users.”

The draft version stated, “Algorithmic recommendation service providers shall uphold mainstream value orientations, optimize algorithmic recommendation service mechanisms, vigorously disseminate positive energy, and advance the use of algorithms upwards and in the direction of good.”

“Algorithmic recommendation service providers may not use algorithmic recommendation services to engage in activities harming national security, upsetting the economic order and the social order, infringing on the lawful rights and interests of other persons, and other such acts prohibited by laws and administrative regulations. They may not use algorithmic recommendation services to disseminate information prohibited by laws and administrative regulations.”

“Algorithmic recommendation service providers shall strengthen information content management; they shall establish and complete feature databases to be used to identify unlawful and harmful information”

“Where unlawful information is discovered, transmission shall cease immediately, measures such as deletion shall be adopted to handle it, information spread shall be prevented, and relevant records preserved; and a report shall be made to the cybersecurity and informationization department. Where harmful information is discovered, it shall be dealt with according to online information content ecology management-related regulations.”

“Algorithmic recommendation service providers shall … vigorously present information content conforming to mainstream value orientations in key segments such as front pages and main screens, hot search terms, selected topics, topic lists, pop-up windows, and more.” “The national cybersecurity and informationization department is to establish a categorized and graded management system, to implement categorized and graded management of algorithmic recommendation service providers on the basis of the public opinion properties of algorithmic recommendation services or their social mobilization capability, content categories, scale of users, the degree of sensitivity of data handled in algorithmic recommendation, the degree of interference in users’ activities, etc.”

“The providers of algorithmic recommendation services with public opinion properties or social mobilization capabilities shall conduct a security assessment according to relevant State regulations.”

“Algorithmic recommendation service providers shall cooperate with relevant competent departments carrying out security assessment, supervision, and inspection work according to the law, and provide the necessary technical, data, other data, and support and assistance.”

The Provision also specifies the punishment such as a fine between 5,000 and 30,000 yuan for violating the regulations. “Where an act violating public order management is constituted, public order management punishment is to be imposed according to the law; where a crime is constituted, criminal liability is to be prosecuted according to the law.”

Source: Cyber Administration of China, August 27, 2021
http://www.cac.gov.cn/2021-08/27/c_1631652502874117.htm

STCN: U.S. Approved Huawei’s Purchase of Automotive Chips

China Security Times (SecuTimes or STCN) recently reported that U.S. officials have approved the blacklisted Chinese telecommunications company Huawei to purchase hundreds of millions of dollars’ worth of chips for its growing auto parts business. In the meantime, the Office of the United States Trade Representative issued a statement saying that Katherine Chi Tai, the U.S. Trade Representative, held a video conference with senior officials of the American Chamber of Commerce China Center Advisory Committee and the US-China Business Council. Tai pointed out that the U.S. is conducting a comprehensive assessment of U.S.-China trade policies and reiterated the importance of U.S.-China trade relations. The Biden administration has granted Huawei suppliers licenses to sell chips used in auto parts such as video screens and sensors. These approvals came as Huawei shifts its business to projects that are not susceptible to the U.S. trade ban. Sources close to the U.S. licensing offices also revealed that the U.S. government is preparing to issue licenses for chips in other vehicles that may have components with 5G functionalities. A Huawei spokesperson declined to comment on these licenses.

Source: STCN, August 25, 2021
https://bit.ly/3kzkdMB

China’s New Regulation: Security Assessment Required for Sending Important Auto Data Overseas

China’s car sharing company Didi Chunxing was subject to a state security audit after its Initial Public Offering (IPO) in the United States in late June. Recently, Beijing issued new regulations requiring that important car data be stored within the country and that a security assessment be implemented before any data leaves China.

According to China’s state media such as Xinhua News Agency, the “automobile data security management regulations (for trial implementation),” effective October 1, 2021, were jointly promulgated by the State Internet Information Office of China, the National Development and Reform Commission, the Ministry of Industry and Information Technology, the Ministry of Public Security, and the Ministry of Transportation.

The regulations state that, if there is a need to provide important data outside the country for business purposes, the auto data operator should implement a security assessment and should not let the data leave the country in violation of the security assessment. The operators are required to report such data activities in their annual report.

The regulations point out that the auto data carrier, when conducting important data processing activities, should follow the provisions of the risk assessment, and submit the security risk assessment report to local authorities. The national cyber authorities will spot-check the security assessment. Car data processors are supposed to cooperate.

Source: Central News Agency, August 20, 2021
https://www.cna.com.tw/news/acn/202108200133.aspx

BBC Chinese: Chinese Government Has Stake in ByteDance which Owns TikTok; Rubio Asked Biden to Ban TikTok

BBC Chinese Edition recently reported that, according to China’s official National Enterprise Credit Information Publicity System, a Chinese company with a government background has invested in ByteDance, owning one percent of the shares. The name of the investor is Wangtou China (Beijing) Technology Co., Ltd. The company was owned by three Chinese state agencies. The company’s registration documents show that it is jointly owned by the China Internet Investment Fund, a subsidiary of China National Radio, and Beijing Cultural Investment Development Group. The China Internet Investment Fund was established by the National Internet Information Office and the Ministry of Finance. That level of stake allows it one seat on the board of ByteDance. ByteDance owns TikTok, which has 700 million international users, including 100 million U.S. users. The U.S. Trump administration issued two bans on TikTok, citing national security concerns. In June of this year, the U.S. Biden administration revoked a series of Trump era executive orders against TikTok. With the new Chinese government investment in ByteDance, U.S. Senator Marco Rubio issued a statement calling on Biden to ban TikTok again.

Source: BBC Chinese, August 20, 2021
https://www.bbc.com/zhongwen/simp/chinese-news-58268021

Lianhe Zaobao: SoftBank Suspended Investments in China

Singapore’s primary Chinese language newspaper Lianhe Zaobao recently reported that Japanese investment giant SoftBank suspended new investments in China while observing the development of China’s rectification of its domestic technology industry. Masayoshi Son, Chairman and President of the SoftBank Group, said at a press conference, “We want to wait and see the changes before the situation becomes more clear.” SoftBank previously invested in Internet giants including Didi, ByteDance (the parent company of TikTok), and Alibaba. China’s recent wave of anti-monopoly regulations this year has brought huge changes to the stock prices of these companies. Since July, Alibaba’s stock price has fallen by 14 percent. Seven Chinese Ministries are jointly conducting cybersecurity reviews on Didi, which also reduced the value of SoftBank investments. According to SoftBank’s 2021 first quarter financial report, its net profit suffered a year-over-year decrease of 39 percent.

Source: Lianhe Zaobao, August 12, 2021
https://www.zaobao.com.sg/realtime/china/story20210812-1181086