The Chinese government approved a new cyber security law, rattling foreign firms operating in the country. The new law has been passed by the standing committee of the parliament and was made public on Monday. Among other things, the law deals with censorship and security reviews in strategic areas.

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The Cyber Security Law will be effective starting on June 2017. It requires internet providers to extend support to investigators pursuing cases related to national security and crime. It also makes it mandatory for the service providers to test and certify the computer equipment. In case of any wrong-doing, the government investigator will have unfettered access to the data.

According to the cyber security law, the business information and data related to Chinese citizens will be required to be kept within the country on domestic servers. It also requires prior approval for any overseas transfer of such data.

Meanwhile, the new policy has evoked strong reaction from foreign firms and authorities. James Zimmerman, chairman of the American Chamber of Commerce in China, said in an email, "This is a step backwards for innovation in China that won't do much to improve security."

However, Zhao Zeliang, director-general of the bureau of cybersecurity for the Cyberspace Administration of China, said that the law is in accordance with international trade protocol. He also added that the law is meant to "safeguard national security."

China's Foreign Ministry Spokesman Lu Kang said that the cyber security law is similar to the rules enacted by other countries. He also said that the law does not provide differential treatment to domestic and foreign companies. 

Tagschina, Cyber Security Law, American Chamber of Commerce in China