CIRC Moves Forward with "Secure and Controllable" ICT Rules

On April 19, the China Insurance Regulatory Commission (CIRC) filed a WTO-TBT notification regarding "Supervision Rules on Insurance Institutions Adopting Digitalized Operations" (Draft for Comments), upholding their 2015 JCCT commitment to ensure that the rules do not pose technical barriers to trade for foreign ICT business operations in China. According to the notification, the new rules will be approved by the WTO Secretariat after 60 days in circulation, and will enter into effect 6 months after approval. 

The new draft presents 11 article changes, removing problematic provisions such as "indigenous IP" and "domestic algorithms". While this does give some flexibility back to insurance institutions and their vendors, the "secure and controllable" and "data-localization" requirements still remain. 

Despite these considerable improvements, there are still concerns regarding the "secure and controllable" rhetoric. Chinese insurance institutions may continue to take a conservative position towards foreign technology when making procurement decisions, much like the trends seen in banking, telecom, aerospace, and other industries deemed critical infrastructure.