Oct 05, 2017
Last week the Chinese government announced that it has imposed “maximum fines” on technology giants Baidu, Tencent and Sina Weibo for failing to adequately censor banned content on their websites. The fines were issued pursuant to China’s recently implemented Cybersecurity Law. The Cyberspace Administration of China, one of the agencies charged with regulating and enforcing China’s Cybersecurity Law, stated that the actions were taken as companies were failing to adequately regulate online content and deal with pornography, violence and other banned content on their platforms. While the regulator did not specify the exact amount of the fines, the law suggests the maximum fine imposed could be up to RMB500,000, or the equivalent of approximately $76,000, which is less than a slap on the wrist for these three tech giants. Local regulators in Guangdong Province issued a similar notice and fine to Tencent, a signal other local regulators may follow.
As CKR Law reported last month, the PRC government adopted the Cybersecurity Law in June 2017, marking a step up in the PRC government’s assertion of control over online content and data collection. The purported goals of the Cybersecurity Law are to safeguard China’s cyberspace sovereignty, national security interests and societal public interest, to protect the lawful rights and interests of its citizens, legal persons and other organizations, and to promote the healthy development of economic and social informatization.
We can expect to see additional enforcement actions brought against technology companies under the Cybersecurity Law as China’s Ministry of Industry and Information Technology, Cyberspace Administration and other governmental agencies tasked with enforcing the law take further actions to “clean-up” what has been deemed “disorderly development” in the internet technology sector. While there have been no reports of fines brought against foreign entities yet, Apple reportedly pulled several of its VPN services following Beijing’s announcement of the new law in June and China’s regulators temporarily blocked access to Facebook’s WhatsApp over the past week.
CKR Law will continue to monitor developments surrounding China’s Cybersecurity Law and related enforcement actions. Should you have any questions or desire further insight, feel free to contact our New York-based China Law team, including Partners Jeffrey A. Rinde (email@example.com), Megan J. Penick (firstname.lastname@example.org), Jing Li (email@example.com), and Associate Joy Xiao (firstname.lastname@example.org), at (212) 259-7300.
DISCLAIMER: This article is not intended to provide legal or tax advice, and no legal, tax or business decision should be made based on its contents. This legal update may be considered attorney advertising in some jurisdictions.
 For an unofficial translation of the Cybersecurity Law, visit https://www.chinalawtranslate.com/bilingual-2016-cybersecurity-law/?lang=en.
 As reported by CNBC on September 25, 2017 at https://www.cnbc.com/2017/09/25/china-fines-tech-giants-over-censorship-blocks-whatsapp.html.
 See China State Council Issues Guidelines on Overseas Investment (August 29, 2017) at https://www.ckrlaw.com/our-voices/2017/08/29/china-state-council-issues-guidelines-overseas-investment/.
 See Footnote 2 above.
 See Footnote 1 above.