The Lingang Special Area of the Shanghai Pilot Free Trade Zone has published a list of permitted outbound data flows covering 64 categories, the first of its kind in China. Data in three sectors – intelligent connected cars, mutual funds and biomedicine – have been allowed for cross-border flows after management rules for cross-border data flows were released in Lingang 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 after users submit an application to the Lingang administration. Core data is banned from cross-border transmission, while the cross-border flows of important data require security assessments in advance.
Tesla, along with 13 other automotive companies such as Porsche’s China sales arm and SAIC Motor, were part of the working group that drafted the general data list. The list would enable Tesla, which operates a vast Gigafactory in the Lingang New Area, to ascertain which data can be transferred abroad without restrictions and which information must receive further scrutiny. Tesla is expected to fall under firms involved in intelligent connected vehicles.
Companies registered in Lingang, or the remaining area of the Shanghai FTZ, can apply for general data cross-border flows as long as the data transfers are conducted in Lingang. The list, which will be initially applicable for one year, is further divided into 11 data applications. Specifically, data of intelligent connected carmakers concerning cross-border production and manufacturing, research and development (R&D) for design purposes, diagnostic data for global after-sales services, and maintenance information for second-hand 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 data compliance costs, he said.
With respect to biomedicine companies, five scenarios including anonymous personal information in clinical trials and R&D, information on product complaints and contract management, have been permitted under the new list. Liu Bing, head of digital technology at Haleon China, said that export of data in the pharmaceutical industry are in the public interest and require international cooperation.
Industry research reports by mutual funds, macro-economic analyses, supplier and risk management data have all received the green light for cross-border data flow. According to Fidelity International, the new list can prevent repetitive investments by multinational asset management companies, lower communication costs and improve operational efficiency. Lu Sen, Director of the Data Department of the Lingang Administration, said the list will be extended over time, preparing for a negative list for cross-border data flows in the future, the China Daily reports.
The South China Morning Post adds that Shanghai has planned to develop the Lingang New Area into an artificial intelligence (AI) “highland”, assembling national talent and resources to help promote the free flow of data.The area’s International Data Economy Industrial Park is tasked with “implementing safe and orderly cross-border flows of international online data”. It would serve as home to more than 100 leading data companies, which could generate a combined output of over CNY100 billion by 2025.
