Regulatory Updates

China Regulatory Update

Currently, Shanghai has the highest monthly average wage among 31 provinces (RMB 11396/US$1685 per month). Eight regions – Shanghai, Guangdong, Beijing, Tianjin, Jiangsu, Shandong, Hubei, and Zhejiang – have surpassed the RMB 2,000 (US$308) mark in their monthly minimum wage standards.

Effective July 2022, employees’ payroll will be  adjusted by  the new social insurance benchmark standard.

Travel restrictions are relaxed

The Chinese Premier, Li Keqiang, promised to relax restrictions on international travel in an “orderly” way, which would include facilitating the return of foreign students to rejoin Chinese colleges. Approximately 500,000 foreign students are enrolled at universities in China.  According to Li, “All international students may return to China to continue their studies should they so wish, and outbound commerce and trade activities and cross-border travel for labor services will be advanced in an orderly fashion.” These comments were made during a Special Virtual Dialogue with Global Business Leaders hosted by the forum.

Standard contractual clauses for cross-border personal information transfer are newly drafted and published by the Cyberspace Administration of China (CAC)

According to the China Personal Information Protection Law (“PIPL”), standard contractual clauses (“Chinese SCCs”) prescribed by the Chinese government can be used as a mechanism for cross-border data transfers from Mainland China. The Chinese cybersecurity regulator Cyberspace Administration of China (CAC) has issued a consultation paper on the Chinese SCCs. Only companies meeting all of the following conditions may rely on the Chinese SCCs to transfer personal information outside of Mainland China:

1)    The company is not a critical information infrastructure operator

2)     The organization processes the personal information of less than 1 million individuals

3)     The company has not cumulatively provided overseas personal information of more than 100,000 individuals since  January 1st of the preceding year and

4)    The organization has not cumulatively provided overseas sensitive personal information of more than 10,000 individuals since January 1st of the preceding year (sensitive personal information refers to the personal information that once leaked or illegally used, can easily lead to the infringement of personal dignity of natural persons or the harm on personal and property safety, including biometrics, religious beliefs, specific identities, medical health, financial accounts, whereabouts, and other information as well as the personal information of minors under the age of 14)

The existing requirement that companies must conduct impact assessments prior to transferring personal data cross-border is highlighted in the Chinese SCCs as the impact assessment results need to be submitted to the local provincial level CAC within ten working days from the effective date of the Chinese SCCs.

The Chinese SCCs also require the company to notify individuals of it being a third-party beneficiary under the Chinese SCCs. The Chinese SCCs need to be provided to the individuals upon request. When the overseas recipient anonymizes or deletes the personal data, an audited report is required for the individual.