US Asks China Not to Implement Cybersecurity Law, NEV Production Quotas Released – China Regulatory Brief

US requests China not to implement Cybersecurity Law

The US has requested China not to implement its controversial new Cybersecurity Law, according to a document published by the World Trade Organization (WTO) on September 26. Many foreign governments and business organizations have also expressed unease at the law, in force since June 1 this year, due to its data localization provisions, restrictions on the cross-border flow of information, and government security reviews.

While the Cyberspace Administration of China (CAC) did not delay implementation of the law, it gave businesses a grace period lasting until December 31, 2018 to comply with the cross-border data flow requirements.

The law is a key component of China’s campaign for “cyberspace sovereignty“, a concept that allows Beijing to govern, monitor, and regulate the internet within the country’s borders. Other controversial measures introduced by the law include real-name recognition for online commenting and restrictions on celebrity gossip reporting.

The CAC has already punished leading Chinese tech firms such as Tencent, Baidu, and Weibo for failing to comply with aspects of the law while the US tech giant Apple has announced plans to establish a data center in Guizhou province to comply with the law’s data localization requirements.

RELATED: Business Advisory Services from Dezan Shira & Associates

China unveils new energy vehicle production quotas

Automakers will need to produce a certain amount of new energy vehicles (NEVs) as a prerequisite to manufacture and import fossil fuel-powered vehicles into China. This is according to a new policy released by the Ministry of Industry and Information Technology (MIIT) that requires automakers to obtain an NEV score equivalent to achieving 10 percent NEV production in 2019 and 12 percent in 2020.

Production of various types of NEVs, such as electric, plug-in hybrid, and fuel cell vehicles, contribute to a higher NEV score. Those who fail to reach the 10 percent mark will have to purchase credits to bridge the difference; failure to comply will result in hefty fines.

The rules apply to automakers that manufacture or import over 30,000 traditional vehicles per year.

The rules are widely considered the world’s most aggressive in promoting the shift from fossil fuel-powered vehicles to NEVs. China is strongly pushing its auto industry towards NEVs as a means to clean up the country’s notorious air pollution and become a global leader in the technology.

China recently revised its Catalogue of Industries for Guiding Foreign Investment and Free Trade Zone Negative List, which both loosen restrictions on foreign investment in the NEV industry.

RELATED: Investing in China’s Green Industries

China issues shorter validity tourist and business visas to Indian nationals

The Chinese embassy in New Delhi has issued tourist and business visas to Indian nationals shorter than the usual 30-day limit. This has been done on a case-by-case basis, and the embassy has not publicly announced a change in policy.

Tourist visas (L visas) and business visas (M visas) for China typically carry a validity of either 30, 60, or 90 days per visit.

Issuing certain Indian nationals shorter stays appears to be in contrast with China’s loosening visa requirements for temporary visitors. Various cities in China, including Shanghai, Shenzhen, and Guangzhou, now allow for visa-free visits for either 24, 72, or 144 hours.

However, China and India only recently resolved a three-month border standoff at Doklam, and tensions between the two countries remain high.

It remains to be seen whether the issuance of shorter validity visas constitutes a wider change in China’s visa policy towards India, or if it is only a temporary measure. Businesses sending Indian nationals to China on business are advised to monitor for further developments and prepare for contingency plans in case their visits are cut short.

Dezan Shira & Associates Brochure

Dezan Shira & Associates is a pan-Asia, multi-disciplinary professional services firm, providing legal, tax and operational advisory to international corporate investors. Operational throughout China, ASEAN and India, our mission is to guide foreign companies through Asia’s complex regulatory environment and assist them with all aspects of establishing, maintaining and growing their business operations in the region. This brochure provides an overview of the services and expertise Dezan Shira & Associates can provide.

An Introduction to Doing Business in China 2017

This Dezan Shira & Associates 2017 China guide provides a comprehensive background and details of all aspects of setting up and operating an American business in China, including due diligence and compliance issues, IP protection, corporate establishment options, calculating tax liabilities, as well as discussing on-going operational issues such as managing bookkeeping, accounts, banking, HR, Payroll, annual license renewals, audit, FCPA compliance and consolidation with US standards and Head Office reporting.

China’s Investment Landscape: Identifying New Opportunities

China’s foreign investment landscape has experienced pivotal changes this year. In this issue of China Briefing magazine, we examine how foreign investors can capitalize on China’s latest FDI reforms. First, we outline new industry liberalizations in both China’s FTZs and the country at large. We then consider when an FTZ makes sense as an investment location, and what businesses should consider when entering one. Finally, we give an overview of China’s latest pro-business reforms that streamline a wide range of administrative and regulatory measures.

Dezan Shira & Associates

• Previous Article IP Protection Campaign Launched, Medical Device Classification Catalogue Revised – China Regulatory Brief
• Next Article Registration of Drugs and Medical Devices Adjusted, Supply Chain Innovation Promoted – China Regulatory Brief