Chinese export restrictions pose new challenges for the global technology industry
Chinese export restrictions pose new challenges for the global technology industry

Legal experts say the recent addition to China's list of controlled technology exports could disrupt many industries and increase the likelihood that some global tech giants will be forced to disconnect from their Chinese operations.

The new list of export control technologies was announced on August 28. This comes as a huge surprise for an industry already grappling with the uncertainty caused by trade tensions between China and the United States.

Originally, the move was seen as a way for Beijing to comment on the opinions of TikTok, a short video sharing app it sells. However, advisers to Chinese and foreign companies said the potential consequences are much greater.

"The rules come as a surprise to many market participants, and there is currently a lot of pressure in the technical field," said Alex Roberts, a consultant at Linklater Law Firm (Shanghai). )Say.

In addition to recommendation algorithms (such as those used by ByteDance's owned TikTok), the "Partially Restricted Export List" also includes drone technology, network security, speech recognition software, and digital scanning software. '' Handwriting.

Companies wishing to export these technologies must first pass the test and obtain approval from the Chinese Ministry of Commerce and the Ministry of Science and Technology.

Nicholas Bahmaniar, a cybersecurity consultant at law firm Liv Beijing, added that the comments could also affect a group of multinational companies doing research and development in China.

Nicholas said, "A company with an R&D center in China will likely face a choice between locating the R&D center in China (China only) or leaving China to take advantage of technology that is found everywhere the world is developed."

The US Commerce Department was quick to respond to speculation that the new rules would primarily target TikTok, saying they were not targeting a company.

Lawyers who have watched these changes carefully say: Because of their wide scope, they have access to many companies in different fields of activity.

These changes could change the opinions of companies like Microsoft, DJI, the video streaming service Zoom and Tencent, which are exporting games around the world, and their third-party cloud services business is growing rapidly.

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