China applies to join digital economy trade deal

Out-Law News | 03 Nov 2021 | 12:53 pm | 1 min. read

China has filed a formal application to join the Digital Economy Partnership Agreement (DEPA), an agreement to facilitate digital trade between member countries.

According to a statement of China’s Ministry of Commerce (MOFCOM), its minister Wang Wentao submitted the application to Damien O'Connor, minister for trade and export growth of New Zealand. New Zealand is the depositary of the agreement.

Chinese regulators are making efforts to draft regulations to better govern data storage, data transfer, and personal data privacy.

Recently China’s Cyberspace Administration of China (CAC) has published draft administrative measures focusing on regulation of those who plan to send user-related data abroad. In August, China passed a new law on personal data protection which took into effect on 1 November.

Leo Xin of Pinsent Masons, the law firm behind Out-Law, said: “It is unclear how DEPA could be aligned with China’s Personal Information Protection Law (PIPL). Especially, the PIPL sets out restrictive rules on cross-border data transfers such as the requirements on security assessment, separate consents from data subjects, model contract to be followed.”

“If the DEPA could create an alternative mechanism to ease cross-border data flow between China and other member countries, it will definitely benefit China’s digital economy and businesses processing personal data in China,” he said.

China’s Data Security Law came into force on 1 September. The law is part of its attempts to “set global standards for the digital sphere”, said the South China Morning Post.

The DEPA was signed by New Zealand, Chile and Singapore in June 2020 and entered into force for New Zealand and Singapore in January 2021. It is a new international trade partnership agreement aiming to help digital trade by regulating digital economy related issues such as data flows and protection, digital inclusion and artificial intelligence.

Canada expressed an interest to join the agreement in December 2020.