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Data Rules Risk Making China ‘Digital Island,’ Companies Say

April 21, 2022

Business group says unclear rules pose challenges to companies Xi Jinping’s government rolling out a host of major data laws China’s “uniquely restrictive” data laws risk boosting U.S. firms’ cost of doing business in the No. 2 economy and could lead to digital decoupling, a new report from an American business group warns.  The government’s curbs on data movement across borders, ambiguous regulation and inconsistent enforcement “are particularly challenging for multinational firms,” according to the US-China Business Council, which describes itself as a private organization of over 260 American companies operating in the Asian nation.

“If the policies are implemented rigidly, a possible outcome is the creation of data islands that force companies to localize technology, people and processes, disconnecting …

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