China TMT: Bi-monthly Update - May & June 2024 Issue
This newsletter summarises the latest developments in Technology, Media, and Telecommunications in China with a focus on the legislative, enforcement and industry developments in this area.
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Key Highlights
In May and June 2024, China made significant strides in the fields of telecom security, artificial intelligence (“AI”), and new energy vehicles:
- Telecom Security: The Ministry of Industry and Information Technology (“MIIT”) and State Administration for Market Regulation (“SAMR”) issued policies to strengthen radio equipment supervision, improve product quality checks, combat illegal broadcast devices, ensure critical network equipment safety, and regulate space business licenses. Newly released measures include comprehensive inspections of radio transmission devices, quality checks for 147 products, actions against “black broadcasts” and “fake base stations”, compliance checks for critical network equipment, and regulatory inspections for space licenses. Emphasising legality and fairness, these initiatives aim to enhance safety, maintain airwave order, ensure network stability, and promote orderly space radio services.
- AI: National and local governments introduced multiple initiatives to enhance AI management and application, promoting high-quality development and standardisation of AI. Actions include issuing cybersecurity standard plans, soliciting international standard proposals, seeking opinions on AI industry standards, hearing the first AI painting copyright infringement case, and increasing computing power and intelligent terminal products. These policies focus on the aspects of safety, compliance, and standardisation, fostering innovation, improving regulatory efficiency, and advancing intelligent industry development.
- New Energy Vehicles: MIIT and Beijing provincial government announced policies to regulate electric vehicle (“EV”) charging, promote autonomous vehicle innovation, ensure the safety of new energy bus’s battery replacements, and advance internet-connected vehicles. Specifically, those policies defined safety standards for EV charging systems, clarified development and management of autonomous vehicle, emphasised regulations on battery replacement for new energy buses, and launched pilot programs for internet-connected vehicles. MIIT also allocated 100 million public mobile communication network numbers dedicated to Internet of vehicles (“IoV”) services to support IoV and internet-connected vehicle industries, enhancing user safety and vehicle experience, and promoting high-quality industry development.
Follow the links below to view the official policy documents or public announcements.
Legislative Developments
1. MIIT issued new measures requiring supervision and inspection of all aspects of radio transmission equipment (29 May)
The MIIT recently released the Measures for Supervision and Inspection of Radio Transmission Equipment, which aims to strengthen and standardise the supervision and inspection of radio transmission equipment, prevent and reduce harmful interference, maintain order in the airwaves, and ensure the normal operation of radio services. The measures clarify the responsibilities of national and local radio management agencies, and implement comprehensive rules of supervision and inspection on the research, production, import, sale, and maintenance of radio transmission equipment.
The State Administration of Traditional Chinese Medicine (“TCM”) issued the revised Management Measures for the Registration of Traditional Chinese Medicine Scientific and Technological Achievements. These measures aim to strengthen the management of TCM scientific and technological achievements, standardise registration work, and promote the transformation and application of these achievements. The measures clarify the responsibilities of the National Administration, provincial TCM authorities, and relevant units, stipulate the conditions and procedures for registration, and impose strict requirements on the authenticity and intellectual property ownership of the achievements.
The SAMR issued detailed rules for quality supervision and random inspection, covering 147 products such as servers, laptops, and drones. These rules specify the sampling methods, inspection items, inspection methods, and judgment criteria for the random inspections.
4. MIIT proposed new mandatory national standard to regulate conductive charging systems for electric vehicles (11 June)
The MIIT sought public comments on the mandatory national standard Safety Requirements for Conductive Charging Systems of Electric Vehicles. This standard sets out rules such as the general safety principles, charging interface safety, and corresponding test methods for conductive charging systems of electric vehicles. This document aims to ensure the safety and reliability of the EV charging process, covering all stages from power grid to EV. The standard will enhance the safety of EV charging facilities and promote the regulated development of the EV industry upon implementation.
5. Beijing proposed new regulations to promote and regulate autonomous vehicle innovation activities (30 June)
Beijing sought public comments on the Autonomous Vehicle Regulations (Draft for Comment). These regulations aim to promote and regulate the development of autonomous vehicles, fostering industry innovation and smart transportation. The regulations cover aspects such as industry innovation, infrastructure planning and construction, and safety guarantees. The regulations clarify the management and regulatory requirements for autonomous vehicles in Beijing, emphasising Beijing-Tianjin-Hebei collaboration, industry self-regulation, and data security. The regulations also provide detailed guidance and safeguards for the safe operation and technological development of autonomous vehicles.
Shanghai recently revised the Shanghai Science and Technology Progress Regulations to comprehensively promote scientific and technological progress and highlight the core role of technological innovation in modern development. The regulations cover fundamental research, technological innovation, result transformation, enterprise technological innovation, and the cultivation of scientific talent. They emphasise the optimisation of scientific resources and the flow of innovation elements, encouraging collaborative innovation among enterprises, universities, and research institutions. The regulations also propose a series of support and safeguard measures to establish Shanghai as a globally influential center for technological innovation, providing robust support for economic and social development.
The National Information Security Standardisation Technical Committee (“TC260”) issued four plans for recommended national standards related to cybersecurity. These cover the basic security requirements for generative AI services, the format of asset information and alert information for network security product interoperability, and technical specifications for unified threat management products. TC260 oversees these standards, requiring working groups and project leaders to develop and implement plans, solicit broad feedback, to ensure high-quality standards as required. This initiative aims to enhance the standardisation level of cybersecurity technology in China and promote the healthy development of the cybersecurity industry.
8. TC260 solicited proposals for ISO/IEC JTC1/SC27 international cybersecurity standards, prioritizing AI security, IoT security, and personal information protection (29 May)The TC260 issued a notice to solicit proposals for ISO/IEC JTC1/SC27 international cybersecurity standards. This initiative aims to promote the international standardisation of China’s cybersecurity technologies and applications, encouraging the export of excellent practices and research project standards. Proposals should prioritise areas such as AI security, IoV security, and personal information protection, and they provided that applicant organisations must have relevant research capabilities and practical experience.
Enforcement Developments
The Ministry of Public Security recently announced the top ten prevalent telecom and online fraud types for 2024 and continues to conduct a series of operations to combat these crimes effectively. The top ten fraud types include rebate scams, fake online investment schemes, fake shopping services, impersonating e-commerce logistics customer service, fake loans, fake credit evaluations, fake acquaintances of leaders, impersonating faking of public security, judiciary, or government officials, online romance scams, and fake online game product transactions.
10. MIIT announced actions and typical cases in combating “black broadcasts” and “fake base stations” (11 June)
The MIIT has intensified efforts to combat illegal activities involving “black broadcasts” and “fake base stations.” A total of 36 “black broadcast” cases were investigated, and 37 sets of equipment were confiscated, achieving dynamic elimination of “fake base station” crimes and effectively maintaining order in the airwaves. Notable cases include the joint crackdown on “black broadcasts” interfering with flights in Xingtai and Hengshui, Hebei Province, the swift seizure of “black broadcast” equipment in Tieling, Liaoning Province, and the rapid removal of vulgar advertisement broadcasts in Yantai, Shandong Province. These actions demonstrate the determination of radio management agencies to enforce laws and ensure radio security.
11. Beijing Internet Court held the first trial in China involving copyright infringement in AI painting model training (20 June)
The Beijing Internet Court held the first trial in China involving copyright infringement related to AI painting model training. Four illustrators sued the developers and operators of an AI painting software, accusing them of using their original works for AI model training without permission, thus infringing on their copyrights. The plaintiffs demanded that the defendants stop the infringement and compensate for the damages. The defendants argued that their actions did not constitute infringement and claimed fair use. The case is still under trial, with intense debates on key issues like copyright, infringement actions, and liability. The court has yet to make a final ruling.
12. CAC released the sixth batch of deep synthesis service algorithm filings, involving 492 algorithms (12 June)
The Cyberspace Administration of China (“CAC”) published the sixth batch of deep synthesis service algorithm filing information. This batch includes 492 algorithms across various application fields, such as image generation, video generation, text generation, and dialogue generation.
The MIIT announced the 16th batch of critical network equipment that meets the mandatory national standard the General Requirements for Security of Critical Network Equipment (GB40050-2021). The listed equipment includes core routers, layer-3 switches, and programmable logic controllers and the test results indicated that these devices comply with various cybersecurity requirements, enhancing the security performance and ensuring the stability and safety of network operations. The publication also details the validity periods and testing institutions for transparency and public access.
14. MIIT announced 2023 annual administrative license inspection results for space services, finding overall compliance (17 May)The MIIT announced the results of the 2023 “Double Random, One Public” inspection for space business administrative licenses. The inspection covered satellite radio frequency usage, space radio station setups, and satellite communication network frequencies, involving multiple entities. The results showed that most entities conducted their business in compliance with laws and regulations. However, some issues were identified, such as expired licenses not being utilised and discrepancies between licenses and actual equipment standards. These issues have been rectified as required. The inspection aims to ensure the standardised operation of space radio services, improve the management of radio frequency usage and station setups, and promote healthy industry development.
Industry Developments
15. MIIT sought opinions on multiple AI industry standard projects, covering areas such as vision and neural networks (25 June)
The MIIT issued a notice to solicit opinions on 12 industry standard projects, including Artificial Intelligence: Data Processing Flow and Quality Evaluation Model for Large Model Training. These standards cover various AI technical fields, such as large model training, automated visual data annotation, neural network model conversion and compression, high-speed video analysis, and industrial vision model training. The solicitation aims to ensure the scientific and practical applicability of the standards, promoting high-quality development in the new generation of information technology and AI fields.
16. CAC held a symposium on “Rule of Law in Cyberspace to Support Building a Cyber Power” to strengthen cyberspace governance (21 June)
The CAC held a symposium on Rule of Law in Cyberspace to Support Building a Cyber Power, focusing on Xi Jinping’s thoughts on the rule of law and his important ideas on building a cyber power. The meeting reviewed 30 years of China’s achievements in cyberspace law, outlined new tasks and directions, and emphasised the need to enhance the legal framework, law enforcement, public legal awareness, and international cooperation. The symposium, chaired by Zhuang Rongwen, included speeches from leaders of the Ministry of Public Security and Ministry of Justice stressing the importance of robust legal support for the high-quality development of the cyberspace sector.
17. AMAC issued new guidelines to strengthen the management of online fund sales information systems (21 June)
The Asset Management Association of China (“AMAC”) released the Technical Guidelines for Online Fund Sales Information Systems to ensure the secure, reliable, and efficient operation of these systems, promoting healthy development of fund sales and protecting investors’ rights. The guidelines cover system planning, risk management, data security, and information confidentiality, specifying the responsibilities and technical requirements for fund sales institutions and proposing specific measures for system management and security protection.
18. NMPA released a list of typical AI application scenarios in drug regulation, highlighting urgent needs (18 June)
The National Medical Products Administration (“NMPA”) issued the List of Typical AI Application Scenarios in Drug Regulation to promote the deep application of AI technology in drug regulation and enhance regulatory efficiency and quality. The list includes 15 leading application scenarios covering four categories: access approval, daily supervision, public services, and decision support. AI applications can automate form reviews, assist in evaluations, organise documents, enable remote and on-site supervision, aid inspections, support investigations, and enhance drug vigilance. Local drug regulatory departments will explore and implement these scenarios to empower the regulatory system with AI, ensuring network and data security and the robust development of technology applications.
The State Council Information Office held a press conference in Beijing on the rule of law in cyberspace ensuring high-quality development. Wang Song, Deputy Director of the Cyberspace Administration of China, highlighted the work in this area. 2024 marks the 10th anniversary of President Xi Jinping’s cyber power strategy and 30 years of China’s full access to the international internet and the start of its network law construction. The Report of 30 Years of Cyber Law in China was developed by the CAC and discussed during the conference, during which legal frameworks for the digital economy and AI were also discussed.
20. MIIT proposed a notice on replacing power batteries for new energy city buses to ensure safe travel (7 June)
The MIIT issued the draft notice on the Matters Concerning the Replacement of Power Batteries for New Energy City Buses. This aims to implement the State Council’s equipment renewal and replacement plan, ensuring the safe and orderly replacement of power batteries in old new energy city buses. The notice emphasises the responsibility for safety, specifies national standards for battery replacement and vehicle performance, and outlines post-replacement requirements for annual inspections, safety management, defect recalls, accident investigations, and insurance claims, to ensure safe and convenient travel for the public.
The MIIT and three other departments jointly announced the first batch of consortia selected for the pilot program on the admission and road access of internet-connected vehicles. The pilot includes nine cities and enterprises, covering various product categories such as passenger cars, trucks, and buses. This initiative aims to advance the practical application of internet-connected vehicles, gather management experience, support the formulation and revision of related laws, regulations, and technical standards, and enhance the production access and road safety management system for internet-connected vehicles in China, promoting high-quality development of the internet-connected new energy vehicle industry.
The MIIT planned 100 million 11-digit public mobile communication network numbers dedicated to IoV services. This initiative aims to implement the government’s directive to strengthen the leading position of the internet-connected new energy vehicle industry. The dedicated numbers will facilitate data communication between vehicles and backend systems, in-car internet entertainment, emergency rescue, and enhance user safety and vehicle experience. The MIIT will continue to improve the management of numbering resources, monitor industry trends, and support the high-quality development of the internet-connected vehicle industry.
The Guangdong Provincial People’s Government recently released the Measures for AI Empowerment Across Industries, aiming to accelerate the high-quality development of the AI industry. The measures propose that by 2025, the province’s computing power will exceed 40 EFLOPS, with the core AI industry surpassing 300 billion yuan. By 2027, computing power will exceed 60 EFLOPS, with over 100 smart terminal products and more than 500 application scenarios. The measures cover areas such as chip development, intelligent software upgrades, algorithm industry construction, computing power network layout, and smart terminal product development, fully empowering sectors like manufacturing, education, and healthcare to enhance the province’s AI application level and industrial competitiveness.
24. Beijing proposed new plan to regulate the construction of future industry incubation bases (4 June)
The Beijing Municipal Bureau of Economy and Information Technology released the Management Measures for the Construction of Future Industry Incubation Bases (Draft for Comment). This plan aims to nurture unicorn companies and specialised, innovative “little giant” enterprises by establishing future industry incubation bases to support cutting-edge technology R&D and the transformation of scientific achievements. The measures outline the conditions for base recognition, entry, and dynamic management processes, and provide various policy supports, including financial rewards, financing assistance, and public services. The goal is to promote innovation in six key areas: information, health, manufacturing, energy, materials, and space.
The Management Committee of the Lingang New Area of the China (Shanghai) Pilot Free Trade Zone issued several policies to further gather and develop new computing power and enable new productive forces. The policies aim to build a highland of computing power, support the clustering of intelligent computing centers, improve the deployment of computing resources and green intelligent computing efficiency, and promote the development of autonomous intelligent computing elements. Measures include aspects of subsidies, loan interest discounts, and support for large model R&D and technological innovation, covering areas such as intelligent computing center construction, computing power dispatching, and international data cooperation. These initiatives are expected to provide solid support for the digital economy development in the Lingang New Area.
26. Hangzhou issued compliance guidelines requiring online service providers to regulate youth gaming recharge behavior (1 June)
The Hangzhou Internet Court released the Compliance Guidelines for Online Service Providers to Regulate Youth Gaming Recharge Behavior during the youth online safety class press conference. These guidelines aim to protect minors’ physical and mental health, safeguard legal rights, prevent gaming addiction and excessive spending, and promote healthy development of online games. The guidelines detailed ten measures, including account real-name authentication, recharge limits for minors, parental monitoring features, and consumption record queries, guiding online game service providers to establish robust anti-addiction and anti-excessive spending mechanisms to ensure minors use online games in a safe and healthy environment.
27. Wuhan issued several measures to support the development of key areas in the digital creative industry (11 June)
Wuhan released the Several Measures to Support the Development of Key Areas in the Digital Creative Industry, aiming to promote the high-quality development of the city’s digital creative sector. The measures included substantial rewards for the creation and online operation of original games, support for game companies developing works with Chinese cultural characteristics, development subsidies for market entities, encouragement of major gaming events, and the establishment of special support programs to cultivate outstanding talent.
