Legal Compliance

CDS is licensed to offer value added telecommunication services in mainland China in the following segments:

Domestic landline Data Transmission (a.k.a. Private lines)

Internet Data Center Services (a.k.a IDC service)

CDN (Content Delivery Network)

Domestic Virtue Private NetworkInternet Access Service (ISP service)

Before 2017, there were no clear regulations published to regulate cross border network and cloud services. There are plenty of ISPs in China leased private lines from big three carriers and offered cross boarder data transmission services (meaning data or image transmission between mainland China and other countries and regions via different kinds of technologies) to their customers.

On Jan 17 2017, China’s Minister of Industry and Information Technology (MIIT) published <The notice to clean and regulate the Internet Access Service provider market by MIIT > (MIIT Document ID [2017]32, herein after referred to as No.32). Based on No.32, value added telecom service provider are not allowed to build or lease cross-border provide lines, including VPN to provide cross-border telecom services without specific approval from the telecom governing authority. Infrastructural carriers (referring to big 3) may lease cross-border lines to users, but must register the user profile and clarify with the user that the cross-border lines shall be dedicatedly used for the office business operation. It shall not be used to connect to the data centers or pops located overseas to provide telecom services. MIIT started the thorough and deep screening to rectify the ISP market in China.

Dec 27 2017, MIIT Information and communication management bureau published <Meeting Memo about ISP market clearing works and standard procedures> (MIIT Document ID [2017]2496, herein after No 2496). No.2496 has provided in further details the disposal plan of the illegal use of the cross-border lines.

March 30 2018, led by the China Information and Communication Institution, the three infrastructure carriers (BIG 3) and IP-VPN ISP providers, China cross-border Data Transmission Industry Alliance (CDTIA) was established. On the same day, CDTIA published the China Cross-border data communication self-discipline convention .

The clause 6 and clause 10 in the convention specified the requirement to operate the cross-border data transmission services, which is in accordance with NO. 32 and No.2496. Based on The Convention clause 10, global enterprises, for the purpose of internal uses such as office operation, work collaboration and data exchanges, may adopt cross-border services via these two ways:

1) Directly lease from the three infrastructural telecom carriers to connect with the companies’ private network and devices.
2) Or global companies may initiate directly from overseas or indirectly work with a global ISP to lease the international private line from the big three carriers to connect with company’s network and devices.

As a formal member of CDTIA, CDS offers cross border cloud and network services following the structure defined in the CDTIA convention as well as 2017 No. 32 requirements.

If you have more question about legal compliance requirement in the services we provide in China, please contact us.