Database

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Restrictions on data

CHINA

Since May 2014

Chapter Data policies  |  Sub-chapter Restrictions cross-border on data flows
China's Management Measures for Population Health Information
Population health information needs to be stored and processed within China. In addition, storage is not allowed overseas.
Coverage Health sector
Restrictions on data

CHINA

Since May 2011

Chapter Data policies  |  Sub-chapter Restrictions cross-border on data flows
Notice to Urge Banking Financial Institutions to Protect Personal Financial Information
The "Notice to Urge Banking Financial Institutions to Protect Personal Financial Information" states that the processing of personal information collected by commercial banks must be stored, handled and analysed within the territory of China and such personal information is not allowed to be transferred overseas.
Coverage Financial sector
Sources
  • [Notice on Urging Banking Financial Institutions to Do a Good Job in Protecting Personal Financial Information] (promulgated by the People’s Bank of China, Jan. 21, 2011), available at http://www.lawinfochina.com/display.aspx?lib=law&id=8837&CGid=
  • Gigi Cheah (2011), Protection of Personal Financial Information in China, Norton Rose Fulbright. Available at http://www.nortonrosefulbright.com/knowledge/publications/56148/protection-of-personal-financial-information-in-china.
Establishment restrictions

CHINA

Since 1996

Chapter Bussiness mobility  |  Sub-chapter Quotas, Labour Market Tests, Limits of Stay
Rules for the Administration of Employment of Foreigners in China, Chapter IV, Chapter II, Article 6
There are labour market tests. The post to be filled by the foreign service suppliers who is recruited by the employer shall be:
- a post of special need;
- a post that cannot be filled by any domestic candidate;
- a post that does not violate any government regulations.
Coverage Horizontal
Sources
Establishment restrictions

CHINA

Reported in 2015

Chapter Competition policy  |  Sub-chapter Competition
Licence requirement
China imposes strict limitations on companies that wish to offer VoIP services in the country. It requires a supplier to have a value-added service (VAS) license to provide VoIP service, and a basic telecommunications service license in order to interconnect VoIP services with the public switched telecommunications network.
Coverage Telecommunication sector
Source
  • 2015 Section 1377 Review On Compliance with TelecommunicationsTrade Agreements: https://ustr.gov/sites/default/files/2015-Section-1377-Report_FINAL.pdf
Establishment restrictions

CHINA

Reported in 2015

Chapter Competition policy  |  Sub-chapter Competition
State Owned Enterprise (SOE)
China Telecom Corporation Limited (China Telecom), the incumbent, is a State-owned enterprise (SOE) providing basic, mobile and value added telecommunication services. In 2014, China Telecom had 52.6% market share of the fixed-line broadband market in China and was the third largest mobile services provider.
Coverage Telecommunication sector
Establishment restrictions

CHINA

Reported in 2015

Chapter Competition policy  |  Sub-chapter Competition
Lack of deregulation
The telecom sector is not liberalized and there are various state-owned enterprises in different segments of the market. Furthermore, only in 2014, Chinese authorities decided for the price liberalization of telecommunication services.
Coverage Telecommunication sector
Establishment restrictions

CHINA

Since 2008

Chapter Intellectual Property Rights  |  Sub-chapter Other restrictive practices related to IPR
State-Owned Patent Funds
Under the National Intellectual Property Strategy, all local governments at province level have issued patent fund policies, which would allow patens to be used to inforce legal injunction against foreign competition.
Coverage Horizontal
Establishment restrictions

CHINA

Reported in 2007

Chapter Intellectual Property Rights  |  Sub-chapter Trade secrets
Multi-level protection scheme (MLPS)
The Multi-level protection scheme (MLPS) introduced by the Ministry of Public Security prohibits government authorities with IT systems classified as "critical infrastructure" to purchase and incorporate foreign IT products. The MLPS requires all IT systems in China to be classified on different levels of security, from one to five (with the most sensitive systems designated as level 5).

MLPS regulations bar Chinese information systems graded level three and above from incorporating foreign products. Systems labeled as grade level three and above, for instance, must solely contain products developed by Chinese information security companies and their key components must bear Chinese intellectual property. Companies making systems labeled as grade level three and above must disclose product source codes, encryption keys, and other confidential business information.

To date, government agencies, firms in China’s financial sector, Chinese telecommunications companies, Chinese companies operating the domestic power grid, educational institutions, and hospitals in China have issued hundreds of request for proposals (RFPs) incorporating MLPS requirements. By incorporating level three requirements, many RFPs rule out the purchase of foreign products.
Coverage All IT products purchased by government organisation for IT systems classified as "critical infrastructure"
Establishment restrictions

CHINA

Reported in 2013

Chapter Intellectual Property Rights  |  Sub-chapter Copyright
Use of illegal software by State Owened Enterprises (SOEs) and government institutions
Despite the legalization of software in government offices completed in January 2014, losses by software companies due to piracy at SOEs and other enterprises are reported to remain very high. Unlicensed software installation rate remains at 74%. Commercial value of unlicensed software is estimated to be around USD 8.8 billion.

Moreover, the industry reports that in 2013 the revenues from digital music sales in China were USD 65.4 million, compared to USD 108.3 million in South Korea, and USD 32.0 million in Thailand – a country with less than five percent of China’s population and a roughly equivalent per capita GDP.
Coverage Software
Establishment restrictions

CHINA

Since 1990

Chapter Intellectual Property Rights  |  Sub-chapter Copyright
Chinese Copyright Act
In the Chinese national law, there is no clear fair use/fair dealing concept. Art. 22 of the Chinese Copyright Act enumerates a detailed list of limited exceptions to defend the charges of copyright infringement.
Coverage Horizontal
Establishment restrictions

CHINA

In April 2014

Chapter Intellectual Property Rights  |  Sub-chapter Patents
Standard essential patents (SEPs)
In April 2014, China's Ministry of Commerce (MOFCOM) gave a conditional regulatory approval to Microsoft's purchase of Nokia's Devices & Services business. However, behavioural remedies have been imposed both to Microsoft and Nokia.

In particular, Microsoft shall not seek injunctions or exclusion orders against smartphones that read on the standard essential patents (SEPs) and are produced by manufacturers in China. Moreovoer, Microsoft committed to continue to licence smartphone-related SEPs under fair, reasonable and non-discriminatory (FRAND) terms.

Nokia also committed not to seek injunctions in relation to SEPs and to continue licensing its SEPs under FRAND terms.
Coverage Nokia, Microsoft
Establishment restrictions

CHINA

Since 1985

Chapter Intellectual Property Rights  |  Sub-chapter Patents
General Preferential Policy
It is reported that local patent applicants and patentees who are in difficulties to pay for the patent fees have the right to apply to the State Intellectual Property Office for reduced or postponed patent fees. The patent charge can be reduced by an amount of 70%–85%.
Coverage Horizontal
Establishment restrictions

CHINA

Reported in 2015

Chapter Intellectual Property Rights  |  Sub-chapter Patents
Local agent requirement
Non-resident foreigners must appoint an officially designated Chinese agency to act as agent in patent application processes. There are news reports of companies that have been threatened that, in case of complaint about the application process for local patents, they may not be allowed to sell in China in the future.
Coverage Horizontal
Establishment restrictions

CHINA

Reported in 2014

Chapter Intellectual Property Rights  |  Sub-chapter Patents
Indigenous innovation promotion
China’s indigenous innovation practices are a web of policies, regulations and strategies that create incentives for Chinese enterprises to create advanced technologies. Only enterprises having Chinese legal person status can apply for accreditation of a product. Moreover, in order to be accredited, a product must have been manufactured by an entity that has full ownership of intellectual property rights in China, either by creating the rights or by acquiring them. It is reported that the goal of these policies is to encourage domestic innovation, and to build and support “national champions" by providing financial incentives that favor domestic innovation.
Coverage Horizontal
Establishment restrictions

CHINA

In April 2015

Chapter Intellectual Property Rights  |  Sub-chapter Patents
Disputes on patent infringment
There are no injunctions that apply today, but several dispute are ongoing. Huawei, China’s largest telecom equipment vendor, is suing ZTE over patents and trademarks in three European countries - Germany, France and Hungary. Unprecedented for Chinese firms, ZTE decided to bring the patent disputes to the courts on the Chinese Mainland. In April 2015, ZTE sued Huawei over patent infringement of their Honor X2 and P8 devices in Chinese courts.
Coverage Huawei, ZTE