China Monthly TMC Update – March 2017

China publishes strategy on cyberspace cooperation

China published its first Strategy on International Cooperation in Cyberspace (the “Strategy”) on 1 March 2017. According to the Strategy, China will focus on the four basic principles of peace, sovereignty, shared governance and shared benefits to promote international cooperation on cyberspace.

The strategic goals of China's participation in international cyberspace cooperation are safeguarding sovereignty and security, developing a system of international rules, promoting fair internet governance, protecting legitimate rights and interests of citizens, promoting cooperation on digital economy and building a platform for cyber culture exchange.

The Strategy also specifies China’s nine action plans, which include proposing and facilitating the peace and stability of cyberspace, promoting the establishment of rule-based order in cyberspace, continuously expanding partnership in cyberspace, actively promoting the innovation of global cyberspace governance systems, strengthening the international cooperation against cyber terrorism and cybercrimes, promoting the protection of citizens’ privacy and other rights, encouraging the development of digital economy and the sharing of benefits. The action plans emphasise the importance China is placing on the construction and protection of global information infrastructure and facilitating online culture communication.

Please click here to read a Law-Now article on more information about the Strategy.

MIIT seeks comments on licensing the use of radio frequencies

The Ministry of Industry and Information Technology (“MIIT”) published the Draft Administrative Measures on Licensing the Use of Radio Frequencies (the “Draft”) on 6 March 2017 to seek public comments. Due to the rapid development of mobile communication, Internet of Things, industrial control systems and other new technologies, the use of radio frequencies has been increasing and consequently requires a more regulated licensing regime.

The Draft sets out the application requirements and procedures for a licence to use radio frequencies. Typically, a licence will specify the user, the radio frequencies licensed, the transmission types, the geographic and business scopes, the licensed period and utilisation requirements. The longest license period granted will not exceed 10 years. The Draft also creates restrictions on the use of radio frequencies. For example, a licensee shall not transfer its use right without being approved. A licensee is also required to file annual reports with the administrative authorities.

According to the Draft, foreign-related licensing matters shall be handled by the administrative authorities in accordance with the relevant legal requirements however the Draft does not provide any further explanation of such relevant requirements.

Please click here to read the full text of the Draft (Chinese only).

MOFCOM releases three draft service specifications to guide sharing economy development

The Ministry of Commerce (“MOFCOM”) released three draft specifications (the “Drafts”) to provide guidance in the operation of serviced apartment services, bed & breakfast (“B&B”) services and community catering services, the three most important sharing economy business models.

The Drafts provide a series of service specifications and standards concerning facility and household product quality, safety and security protection, food hygiene, personnel and internal management, and customer experience. The Drafts also set out the requirements for “high standard and demonstration” serviced apartments and B&Bs.

This is the first time that the government has published guidance in this area. While the service specifications will not have legally binding effects, they demonstrate the best practice and might be referred in future legislation.

Please click here to read the full text (Chinese only) of the Drafts.

New GRCL includes personal information protection provision

The National People’s Congress published the General Rules of the Civil Law (“GRCL”) on 15 March 2017. The GRCL set out the most basic legal principles governing civil relations, and is the most fundamental legal resource of the civil law.

Article 111 of the GRCL provides that an individual’s personal information shall be protected by law. If a party wants to obtain an individual’s personal information, it shall do so legally and ensure the security of the information obtained. No party shall illegally collect, use, process or transfer an individual’s personal information or illegally sell, provide to other parties or publish an individual’s personal information.

Although personal information protection requirements can be found in different regulations and department rules, this is the first time that the general personal information protection principles are specified in a legal resource of such a high authority. The principles are likely to act as the foundation for the formulation of comprehensive personal information protection rules in the future.

Several TMC regulations are included in the government’s legislation schedule for 2017

The State Council published its legislation schedule for 2017 in late March (the “Schedule”). Several regulations governing matters in the TMC sector are specifically included in the Schedule.

According to the Schedule, the Office of Security Commercial Code Administration shall proceed with drafting the regulations governing the manufacturing, sales, and use of encryption products. The Ministry of Civil Affairs is encouraged to initiate the revision of regulations governing foundations, social groups and privately-operated non-enterprises. Together with the new foreign NGO law, they will set out the overall regulatory framework for social organisations’ activities in China.

The Schedule specifies that the Cyberspace Administration of China is expected to finish the revisions to the Administrative Measures for Internet Information Service by the end of the year. These measures are likely to affect the operation of various types of websites and online information services. In the area of e-commerce, the State Council will continue providing support to the National People’s Congress on drafting the People’s Republic of China E-commerce Law. In the meantime, the State Council has also encouraged the Ministry of Transport and the State Post Bureau to formulate regulations governing express delivery businesses by the end of the year.