On January 3, 2025, the Cyberspace Administration of China (CAC) issued a draft document titled “Measures for the Certification of Personal Information Protection for Cross-Border Data Transfers” intended for public consultation. The extensive document, which comprises 20 detailed articles, lays out a comprehensive framework for certifying the security and compliance of personal data transfers beyond China’s borders. The feedback deadline has been set for February 3, 2025, and these draft measures represent a critical step in China’s broader strategy to enhance data governance, ensure cybersecurity, and address global concerns regarding the safety of cross-border information flows. Significantly, the measures form a substantial component of China’s overarching data governance strategy, aiming to tackle the challenges associated with cross-border data movements while protecting individual privacy rights and ensuring data security.
Defining PI Protection Certification
Article 3 of the draft measures explicitly defines “PI protection certification” within the context of cross-border data transfers as a formal evaluation process conducted by bodies authorized by the State Administration for Market Regulation (SAMR). These certification bodies are tasked with assessing the compliance of personal information processors—both domestic and foreign—with the secure cross-border data transfer requirements. This certification ensures that processors adhere to the stringent criteria delineated in the regulations, thereby protecting individuals’ personal information while facilitating international data exchanges. Certified entities must demonstrate their capability to manage cross-border data transfers in accordance with the standards established by the CAC and SAMR. The certification process not only verifies compliance but also serves as a guarantee to the public and regulatory authorities that the certified processors meet the necessary data protection measures.
The emphasis on PI protection certification reflects the importance of upholding robust data protection standards in an increasingly interconnected world. As personal data traverses international borders, ensuring its protection becomes a priority for national governance. The draft measures by the CAC signify a strategic move to align domestic data protection practices with global standards while reinforcing China’s commitment to safeguarding personal information in cross-border contexts. This regulatory framework seeks to build trust and assurance for individuals, organizations, and international stakeholders, fostering a secure environment for data exchanges that transcend national boundaries.
Scope of Cross-Border Data Transfers
The scope of “cross-border data transfers” encompasses diverse scenarios where personal information moves across national boundaries. These include situations such as transfers from China to foreign entities, where personal data collected within China is transferred to organizations outside the country. Activities like transferring customer data, employee data, or other types of personal information for purposes of processing or storage fall under this category. Additionally, the draft measures cover cases where foreign entities based outside China are granted access to data stored within Chinese borders. Such scenarios include remote access, querying, downloading, or interacting with data housed in servers or data centers located within China.
In line with the Personal Information Protection Law (PIPL), cross-border data transfers also encompass cases where foreign entities handle personal information of individuals located in China. This may occur if a foreign company processes data related to Chinese citizens, even if the data is stored outside China. The measures extend the regulations’ scope to ensure that foreign processors comply with the data protection principles outlined for cross-border transfers. By defining and regulating these different scenarios, the draft measures aim to establish a clear and comprehensive framework for managing the complexities of cross-border data flows while prioritizing personal data protection.
The broad scope of cross-border data transfers delineated in the draft measures underscores the multifaceted nature of modern data exchanges. As global businesses increasingly rely on seamless data transfer and access, these regulations aim to strike a balance between enabling international data transactions and safeguarding personal information. The measures are designed to address the potential risks and vulnerabilities associated with cross-border data transfers, ensuring that data security and privacy protections remain intact regardless of where the data is transferred or accessed. By doing so, China aims to create a regulated data environment that fosters trust and accountability among all stakeholders involved in cross-border data activities.
Eligibility Criteria for Certification
Article 4 of the draft measures specifies that domestic personal information processors wishing to transfer their data overseas via personal information protection certification must fulfill certain eligibility criteria. These criteria serve to narrow down the certification process to entities with a significant role in handling personal data. For companies to be eligible, they must ensure that they do not fall under the classification of Critical Information Infrastructure Operators (CIIOs). Additionally, the company must have provided personal information of between 100,000 and one million people or sensitive personal information of more than 10,000 people to overseas parties since January 1 of the current year. Moreover, the personal information intended for export must not belong to the category of important data.
These thresholds are carefully established to focus certification efforts on major data processors while ensuring that smaller or less impactful data processors are not unduly burdened by the certification process. Aligning with the thresholds set in the Regulations to Promote and Standardize Cross-Border Data Flows, the criteria are meant to streamline the certification process without compromising the security and protection of personal data. By adopting a targeted approach, the draft measures aim to enhance data governance practices while minimizing the administrative and compliance burden on less significant data processors.
The eligibility criteria outlined in the draft measures provide a clear guideline for domestic entities seeking to transfer personal information overseas. By focusing on companies with a substantial role in managing personal data, the measures ensure that the certification process effectively addresses potential risks and vulnerabilities in large-scale data transfers. This approach allows regulators to concentrate resources and oversight on entities with a more significant impact on personal data flows, thereby reinforcing the overall framework for data security and compliance.
Certification Process for Foreign Entities
Foreign entities must obtain certification before legally handling the personal data of individuals within China. This certification requirement extends to any data handling activity involving Chinese individuals, whether the data is processed within or outside of China. Foreign processors can achieve certification by engaging a local representative or entity in China that serves as a liaison for compliance purposes. The certification process necessitates the submission of an extensive set of materials for evaluation. These typically include risk mitigation plans detailing how the processor intends to manage and address potential security threats, legal agreements that ensure the recipient of the data abroad will fulfill the required data protection obligations, and detailed compliance strategies showing adherence to certification standards.
Certification bodies will assess applications based on several key factors, ensuring the legitimacy, necessity, and reasonableness of each data transfer. Each transfer must be evaluated for its purpose, necessity, and proportionality, ensuring that only essential data is transferred and that the transfer is necessary for the intended business purposes. Additionally, certification bodies will examine the data protection laws and regulatory environment in the recipient country to ensure that personal data continues to be protected once it leaves China. Legal agreements outlining the data protection obligations of the receiving party are crucial to ensure compliance with China’s legal standards. Furthermore, certification bodies will evaluate the technical and organizational measures in place to secure the data during transfer and processing, such as encryption and access controls.
The rigorous certification process for foreign entities emphasizes China’s commitment to meticulous data protection practices. By enforcing stringent evaluation criteria, the draft measures aim to ensure that cross-border data transfers occur within a secure regulatory framework. Foreign entities complying with these requirements demonstrate their dedication to maintaining high data protection standards, fostering trust in international data exchanges. This approach underscores China’s emphasis on creating a secure environment for data flows while safeguarding the personal information of its citizens against potential risks associated with cross-border data activities.
Ongoing Monitoring and Compliance
Articles 10 and 13 of the draft measures specify that once certified, entities will be subject to ongoing monitoring by certification bodies, which reflects a commitment to maintaining a high level of security and accountability throughout the lifespan of cross-border data transfers. Certification bodies will conduct periodic audits to ensure continued compliance with the established standards and regulations, which ensures that certified entities consistently adhere to the data protection requirements. Additionally, these bodies will establish clear channels for reporting violations and addressing data security concerns, allowing individuals and organizations to actively participate in the regulatory process and enforce transparency.
Provisions for public reporting of violations related to cross-border data transfers are a key component of these measures. Organizations and individuals can report breaches or non-compliance with data protection standards to local or higher-level authorities, ensuring that concerns are promptly raised and that regulators can take appropriate actions to mitigate risks or rectify breaches. Establishing this mechanism fosters a collaborative regulatory environment where stakeholders can engage in maintaining data security and accountability throughout the certification process and across cross-border data transfers.
The ongoing monitoring and compliance framework signifies a robust regulatory infrastructure designed to safeguard personal data during cross-border transfers. By implementing periodic audits and public reporting mechanisms, the draft measures aim to create a proactive approach to data protection that addresses potential risks in real time. This continuous oversight reinforces the accountability of certified entities, ensuring that they uphold high data security standards throughout their operations. The commitment to ongoing compliance monitoring aligns with international best practices, enhancing China’s position in the global data protection landscape and establishing a secure environment for trusted cross-border data activities.
Confidentiality, International Cooperation, and Penalties
The concept of “cross-border data transfers” refers to various situations where personal information crosses national boundaries. This can involve transferring data collected in China to organizations in other countries, such as customer or employee information for processing or storage purposes. Additionally, the draft regulations cover scenarios where foreign entities outside China access data stored within the country. This includes remote access, querying, downloading, or interacting with data housed on servers or in data centers within China.
According to the Personal Information Protection Law (PIPL), cross-border data transfers also include situations where foreign entities process personal information of individuals in China, even if that data is stored outside China. These measures ensure that foreign processors adhere to data protection principles established for cross-border transfers. The draft regulations aim to create a clear framework for managing the complexities of cross-border data transfers while prioritizing personal data protection.
The extensive scope of cross-border data transfers detailed in the draft measures highlights the complex nature of modern data exchanges. As global businesses increasingly depend on seamless data transfer and access, these regulations strive to balance enabling international data transactions with protecting personal information. The measures address potential risks and vulnerabilities associated with cross-border data transfers, ensuring data security and privacy protections remain robust regardless of where data is transferred or accessed. By implementing these regulations, China seeks to create a regulated data environment that fosters trust and accountability among all parties involved in cross-border data activities.
