China had decided to implement a new cybersecurity law that could hinder the business prospects of any foreign firm. The bill is anticipated to come into effect in the month of June. China being the world’s second largest market economy has become more susceptible to cyber crimes such as hacking. The new cybersecurity law is expected to fight against the Chinese and non-Chinese hackers. The law enforces the foreign firms to provide confidential information such as the details about network software to the Chinese government. The transfer of intellectual information as per the law has resulted in panic amongst the business organizations.
The companies that fall into the major risk category are those firms that deal with specific hardware systems such as ATMs. The network management systems with higher connectivity are more prone to hacking. The cybersecurity law allows the Chinese government to acquire all the necessary security hardware. In the case of weak enforcement of the law, the personal banking information can get into the wrong hands. Thus, the new law tends to become counterproductive. Apart from the threat to potential information, the law can also lead to the creation of duplicate facilities. The bill warrants the American businesses to take a call before doing business in China.
The cybersecurity law creates a tough time for all international companies. It is essential for the organizations to either comply with the law or remain excepted from the Chinese business portals. The law has brought out a challenging situation. Most the companies are expected to adhere to the new law as the Chinese markets have huge business prospects. Apart from creating international trade barriers, the cybersecurity law allows the Chinese businesses to flourish. The law has given rise to indigenous innovation for Chinese products. This cybersecurity bill is sure to perform as an excellent firewall. The international companies should become more dexterous to withstand the politically adept cybersecurity law.