Data privacy in China Measures for the Supervision and Administration of Online Transactions

On 15 March 2021, the State Administration for Market Regulation in Mainland China officially approved the Measures for the Supervision and Administration of Online Transactions (the “Measures”), which came into force on 1 May 2021.

The Measures provide detailed guidance on e-commerce, consumer protection and cybersecurity law. Given the growth of online transactions such as social e-commerce and live-streamed shopping in China, the new and more stringent rules aim to better protect the rights of consumers.

When customers’ personal details are collected and used, online transaction operators will have to state the purpose, method and scope of personal information being collected and obtain consent from customers. In addition, when collecting and using sensitive information such as biometric data, health data, financial account data and personal tracking data, customers’ consent must be obtained for each item of data. Once collected, customers’ personal information must be kept strictly confidential.

The new rules cover further areas such as the retention of information and the regulation of competition between online transaction operators. Importantly for such operators, all product or service information will have to be disclosed comprehensively, truthfully, accurately and in a timely manner. Furthermore, they will not be allowed to send commercial information to consumers without their consent or request.

Failure to comply with the Measures may result in criminal liabilities, such as rectification orders and fines.