On 27 August, the first discussions between the EU and China under the new communication mechanism on cross-border data flows began.

The mechanism is a deliverable of the political agreement reached in 2023 between Vice-President Yurova and Vice-President Zhang Guoqing at the EU-China High-Level Digital Dialogue, as well as the EU-China High-Level Economic and Trade Dialogue between Executive Vice-President Mr. Dombrovskis and Vice President Mr. He Lifeng. The purpose of the mechanism is to find ways to facilitate cross-border transfers of non-personal data for European businesses, as well as to comply with Chinese data laws. This issue was also raised by President von der Leyen and European Council President Charles Michel at their meeting in December 2023 with China’s President Xi Jiping, followed by an exchange of views with its Prime Minister China Mr. Li Qiang, in the context of the last EU-China summit.

At the first formal meeting of the new mechanism, which is the first cooperation structure between the two sides on this issue, the EU indicated that it wanted to address specific concerns expressed by EU businesses operating in China regarding cross-border non-EU data flows. of a personal nature.

Data flows are essential to commerce. A significant part of EU-China foreign direct investment depends on the ability of companies to manage their cross-border data flow. This is of particular importance in industries such as finance and insurance, pharmaceuticals, automotive and information and communication technology (ICT). Cross-border data flows are crucial for research and development activities and essential for business prosperity.

In recent years, European businesses in China have faced increasing uncertainty and difficulties in exporting data from China. They are particularly concerned about the systematic application of security clearances to exports of all “critical data”, from the 2022 Data Export Security Assessment Measures Act. This concern has been further exacerbated by uncertainty as to what constitutes “material data”, as the concept has so far been vaguely defined and applied very broadly. Restrictions on cross-border data transfer are also contributing significantly to reducing European investor confidence in China.

Further cooperation at the expert and technical level is envisaged to review progress at the political level at the next appropriate opportunity.

Korina Georgiou