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Deliberation Draft Issued to Revise the PRC Regulations on Internet Information Services

25 September 2012
The extent to which the Internet has changed the lives of Chinese people since September 1987, when China first connected to the Internet, is immeasurable. China's netizen population has skyrocketed to over 500 million and further rapid growth is anticipated. Increased internet access has transformed China's economic and media landscape. Not only are businesses going online to tap into ecommerce, new technological phenomena like microblogs and other social networks are making it easier for individuals to select, re-post and sometimes even create news of their own.

Against this backdrop, the Chinese authorities have been scrambling to catch up with the technological advances of the Internet era. Technological advances occur so rapidly that regulators may find the technology outdated before the ink has dried. In yet another attempt to revamp and update its regulatory framework, the State Council (Internet) Information Office ("SCIO") and the telecoms and Internet industry regulator, the Ministry of Industry and Information Technology ("MIIT") released a circular on 7 June 2012 to solicit public opinion on the Internet Information Services Administrative Procedures (Revised Draft for Seeking Comments) ("Deliberation Draft"). The current regulation, the Internet Information Services Administrative Procedures (the "2000 Internet Information Procedures"), were promulgated on, and effective as of, 25 September 2000.

New Licensing Requirement

The latest Internet phenomenon grabbing the attention of the Chinese regulatory authorities are microblogs. Microblogs are very popular in China, partly because they tend to publish (albeit often temporarily and before censors intervene) an unfiltered version of events as compared to the heavily State and propaganda department-controlled and standardised news stories appearing in traditional media. As the leading microblogging service in China, Sina Weibo alone boasts more than 300 million registered users. As with the 'dot.com' phenomena in 2000, the government is now responding to the new technological phenomenon and zeitgeist by rolling out another layer of regulation. Internet information services which allow Internet users to communicate information to the public (e.g., Internet forums, blogs, and microblogs, collectively "Blogging Services" hereinafter) will, under the Deliberation Draft, be subject to a licensing requirement similar to Internet news providers (the latter is notably an area off-limits to foreign investment). Note that a similar licensing requirement applies to Internet information search services (e.g., Baidu) which has been regulated as an Internet information service provider ("ICP").

Real-name User Registration and Record Retention Requirements

Furthermore, the Deliberation Draft included the following things worth noting:

(i) A Blogging Service must obtain a user's true identity during registration and an Internet access service providers ("ISPs") must record the true identity, website name, and Internet address information of those engaging in Blogging Services;

(ii) ICPs must retain records of information communicated by themselves and users for six months; and

(iii) ICPs and Internet access service providers ("ISPs") must archive logs for 12 months and provide technological support for information searches by China's public security and State security authorities in accordance with law.

The first requirement raises concerns regarding data privacy and the broader issue of a blogger's accountability for politically objectionable content. Penalties will be imposed on providers of Blogging Services and ISPs if they fail to enforce this requirement. Regarding the second and third requirements, while helpful for the Chinese authorities to scrutinize the Internet, the new retention requirements (compared with the current 60 day requirement) will inevitably increase the compliance cost of Blogging Services in China, not to mention providing yet another legal basis for the State to require providers to turn over information on dissidents.

Personal Data Protection

However, on the bright side, whilst requiring ICPs and ISPs to collect and retain personal information like identification and logs, the Deliberation Draft nonetheless requires service providers to observe certain data protection obligations. Under the Deliberation Draft, ICPs and ISPs will be prohibited from selling, changing, intentionally divulging, or illegally utilising the personal information of their users. Violation of this provision may lead to criminal liabilities.


Overall, we have not detected any clear signals that the Chinese government is going to change direction from its previous path of heavily regulating the virtual world. Despite its political desire to do so, the Chinese government will inevitably find itself lacking resources to effectively monitor the ever-increasing public participation in China's economic and political life through the Internet. As such, the government is trying to enlist (some would say 'conscript') the support and assistance of ICPs and ISPs. It goes without saying that it is much easier to oversee a smaller number of businesses which are clustered around locations like Beijing and Shanghai than keeping tabs on the millions of netizens scattered across China.

Hogan Lovells TMT

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