Hong Kong is Poised to be the Data Hub for Greater Bay Area

CityU Research group photo

New research recommends a pilot scheme to promote cross-border data flow to meet the diverse policies and regimes

April 24, 2019, Hong Kong –– Greater Bay Area (GBA) is the ideal location to implement a strategic pilot scheme on data flow, as the Area aims to become a global technology innovation center and build advanced manufacturing and modern services industries, according to a new research conducted by City University of Hong Kong.

Commissioned by Microsoft Hong Kong, the independent research, entitled “Legal Research Project: Proposal for Hong Kong to be a Data Center Hub for the Greater Bay Area and China”, examined the legal issues related to cross-border data transfer and recommended Hong Kong as a suitable location to serve as a data depository and processing center for GBA. A step-by-step pilot approach is outlined in the study, providing recommendations to harmonize the policies, regimes and technical aspects related to data transfer within GBA.

CityU Dr Chen speaking

“Mainland China, Hong Kong and Macau have different legal frameworks for data protection and cybersecurity, as they were developed to meet their unique local needs. With GBA, the governments need to reconsider how to facilitate data flow. Hong Kong has been actively participated in international agreements about cross-border data transfer. Coupled with Hong Kong’s international positioning and robust legal framework, all these factors put the city in the forerun as the ideal location for being the data center hub for the Area, and potentially for the entire China in the long run,” said Dr. Lei Chen, Associate Dean & Associate Professor, School of Law, City University of Hong Kong.

CityU Allen speaking

The research recommends establishing a mechanism to categorize data entering and exiting the three jurisdictions in various situations. The “white list” permits certain categories of data entry and exit in certain circumstances, while the “negative list” is able to ascertain the scope of data that are not allowed to be transferred freely. The mechanism needs to identify specific industries or categories (such as financial services, healthcare, small to medium sized businesses), and identify specific purposes (such as e-commerce, enterprises/multinational corporations intergroup communication etc.). These criteria should be amendable and adjusted according to the changes in the systems, technologies and other factors of mainland China, Hong Kong and Macau

“GBA provides Hong Kong a great opportunity to identify new areas of growth and foster more diversified economic development, as the city pushes for stronger innovation and technology progress. With proper big data governance, Hong Kong can take a leading role facilitating cross-border data flow and establishing itself as the data hub for GBA, for Asia, and possibly globally in the long run. With the diverse policies and legal frameworks on data protection and cybersecurity, a pilot scheme is the logical next step to coordinate data transfer matters within the Area,” expressed Mr. Allen Yeung, Founding Chairman of Institute of Big Data Governance (IBDG), a non-profit, neutral platform to promote better protection of big data, with a vision to turn Hong Kong into a global data hub.

CityU Cally Speaking

“To unleash the true potential of GBA, technology is key. Only with seamless data flow, businesses within GBA can accelerate their digital transformation and continue to leverage AI to enhance their business performance. Data and AI can help businesses to generate more advanced analytics and in-depth insights, providing them extra competitive edge to flourish within GBA and even internationally. Hong Kong is well positioned to be the data hub for GBA, and this will further cement the city’s position as the global financial, trading, logistics and aviation capital,” said Ms. Cally Chan, General Manager of Microsoft Hong Kong and Macau, as well as the Council Member of IBDG.

The executive summary of the report is available here.

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