China will tighten data privacy rules for tech companies seeking foreign investment

China will tighten data privacy rules for tech companies seeking foreign investment

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China tightens restrictions on businesses seeking overseas amid a wave of Chinese-origin IPOs in the US Regulators have dropped gloves on domestic companies by announcing new privacy rules for those seeking foreign market lists of stock, according to Reuters. As a result, any company that has data on more than one million customers will have to face a review of how they handle that information in order to obtain permission for a foreign IPO.

Regulators will carefully consider the risks of the data in question being touched, controlled or manipulated by foreign governments following overseas flotations. In a broader effort to get companies to list locally, China is adding two sets of rules that focus on data collection and data storage in its Data Security Act and Data Protection Act. Personal Information.

The restrictions come amid a crackdown on privacy from Beijing. Regulators have previously shaken their sabers TikTok and LinkedIn for alleged violations of data collection. Just last week, authorities caused shock waves by ordering the travel greeting giant Didi to remove her app from mobile stores in the wake of its listing in the US, causing its shares to initially fall by 20 percent.

As U.S.-China tensions still boil, the decision is likely to mount pressure on President Biden to increase surveillance of Chinese businesses. The hostility created by the policies of the Trump era has eased in recent months after the removal of China Xiaomi and Luokung Technology from military blockbusters, which prevented Americans from buying and holding their own stock. An expected merger in relations under Biden is likely to spur a recent rise in Chinese company listings. Last year, China-based businesses raised $ 11.7 billion through 30 IPO in the US, with even more flotations occurring this year.

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