What revisions are being made to China’s laws around state secrets?

A new draft of China’s “Law on Guarding State Secrets” was made public on Wednesday, 25 October

The second revision of the 1989 law (the first was in 2010) deepens state powers and adds 12 new clauses. It will soon be passed by the National People’s Congress after a second reading.

According to the revised law:

• State employees with access to state secrets will require permission before travelling abroad, and even for a period of time after they leave the job or retire;
• There will be restrictions on the employment of personnel with access to state secrets during a “confidentiality period” after they leave their position;
• All levels of government must set aside funds from their annual budget that will pay for the means of keeping information confidential;
• The National Administration of State Secret Protection will have expanded powers to investigate state secret-related cases, including the ability to check and confiscate files and devices, and to question staff;
• The government and media will educate the public on state secrets;
• Tech products that are used to protect state secrets will be regularly checked;
• The government will offer support for the research and application of information security technology.

The new draft has prompted concern among some foreign businesses and individuals in China, especially after authorities questioned staff from several US-based consulting and due diligence firms, including Bain & Company and Mintz Group, earlier this year.

The law could potentially increase the risks of doing business in China, for example, by increasing the chance of businesses having contradictory legal responsibilities in China and their home region. Some argue that terms in the law such as “state secrets”, “national security”, “national interests” and even “employees” remain poorly defined and could thus be interpreted by those enforcing the law.

The Ministry of State Security has said that criticism of China’s new anti-espionage law and the revised state secrets law is unfounded and that while safeguarding state secrets is a top priority, open international trade and exchanges are also vital.

As an SCMP commentary emphasised, it is hoped that the Chinese government will help foreign businesses to understand the law and make compliance as easy as possible.