China ‘suspends until further notice’ bank technology restrictions opposed by the US
Overseas firms feared the rules would force them to hand over encryption keys and other sensitive details of how their systems work if they are operating in China
China has put on hold bank-technology rules that Washington and others complained amount to unfair regulatory pressure on foreign firms, according to a government notice.
The document, dated on Monday and issued by China’s bank and tech industry regulators, said the rules to improve the security of banking technology were suspended until further notice while the government solicits feedback from banks.
The rules sparked concern among foreign business groups and governments after they were issued in December.
Their suspension comes as US Secretary of Commerce Penny Pritzker visits China on a high-profile trade mission to drum up business for American firms.
“I think the government concern is reasonable, but it’s technically impossible to comply with such rules,” said a banker working at a foreign bank in China who declined to be identified.
The decision to suspend the rules came after “financial institutions in the banking industry and related parties put forward opinions for improvements and proposed changes”, the notice said.
The China Banking Regulatory Commission and Ministry of Industry and Information Technology declined to provide immediate comment.