Harmony required for smooth data movement

China and the United States should harmonize data movement across borders, and the connectivity between the two economies should not be disrupted unnecessarily, according to US-China Business Council President Craig Allen.

"For global companies in China, digital trade offers unbounded opportunities. These opportunities have baseline necessities, such as cross-border data flows that are predictable, efficient, and unencumbered," Allen said at the World Internet Conference Wuzhen Summit that kicked off in Zhejiang province on Wednesday.

He explained that the council works tirelessly to ensure greater connectivity between the US and Chinese economies, and "would not like to see that connectivity be disrupted unnecessarily".

"US companies are committed to their customers, suppliers, and partners across China and have a major role to play in shaping the digital economy in China and elsewhere," he said.

"The value of leveraging data is reduced if it cannot circulate easily. We should harmonize international standards on data movement across borders. This is key to sustaining a competitive business environment," he added.

Therefore, Allen vowed further engagement and dialogue with the Chinese government and other stakeholders on this emerging regulatory topic, and to share experience and feedback learned from operating in other markets.

Speaking at the conference, Allen noted that, over the past three years, China's digital economy has experienced rapid transformation, including growing use of smart devices, AI, cloud services and the metaverse, and each of these developments depends upon advances in data and privacy governance.

"Creation of innovative, pragmatic, and well-reasoned policies in these areas is essential to unlocking the limitless potential of the digital revolution while balancing the need for security, safety, and privacy," he said.

Internationally, Allen added that there has been progress on data and privacy governance, which includes the cyberspace standards endorsed at the United Nations in March 2021, the Data Governance Act of the European Union, China's Cybersecurity Law, the Data Security Law, and the Personal Information Protection Law, as well as the US Commerce Department's Global Cross-Border Privacy Rules, and multilateral regimes.

However, given these disparate approaches, companies today face diverse regulatory regimes with different priorities and sensitivities, he said.