New Laws for the Technology Sector

Chinese President Xi Jinping told top leaders to speed up work on new laws for the technology sector during a speech in early December, according to the Chinese Communist Party’s bimonthly journal.

It’s a sign that regulation is not going away yet, even though the speech covers little new ground and economists expect the worst of Beijing’s crackdown is over, CNBC said Friday.

China must “accelerate the pace of legislation in the fields of digital economy, internet finance, artificial intelligence, big data, cloud computing, etc.,” Xi said, according to a CNBC translation of the Chinese text.

He also called for more laws to ensure national security, and urged increased use of law for “international struggles” — including countering foreign sanctions.

But most of Xi’s speech, delivered on Dec. 6 to China’s Central Politburo of top leaders, focused on broad theoretical points such as not blindly following western systems.

In the last year, a succession of new rules aimed at tackling alleged monopolistic practices by tech companies, data security and other issues have shocked global investors. The regulations address long-standing problems, but their abruptness has disrupted businesses and prompted mass layoffs.

“We anticipate there will be continuing developments in regulations particularly as related to tech,” said Mattie Bekink, China director at the Economist Corporate Network. She pointed out that Beijing has released plans for building a “Chinese socialist rule of law” by 2035.

“I do think the use of regulation as a tool to shape the economy and society that China wants is not over,” Bekink said.

She noted how law in the West tends to focus on the relationship between individuals and the state, while in China, the focus has been on commercial law — relationships between private sectors and the state.