China AI Regulations: Complete Compliance Guide

Executive Summary: China has established the world's most comprehensive AI regulatory framework, centered on algorithm registration, security assessments, content review, and data governance. Unlike the EU's risk-based approach or US sector-specific regulations, China's framework emphasizes government oversight, state security, and Communist Party ideology through the Cyberspace Administration of China (CAC). Key regulations include Algorithm Recommendation Regulations (March 2022), Deep Synthesis Regulations (January 2023), and Generative AI Measures (August 2023). Organizations deploying AI in China face mandatory registration, security reviews, content filtering, data localization, and regular reporting requirements, with enforcement including service suspension, fines up to 10% of annual revenue, and criminal liability for serious violations.

:::callout{type="warning" title="Unique Compliance Challenges"} China's AI regulations are fundamentally different from Western frameworks:

• Mandatory government registration and approval before deployment
• Content must align with "socialist core values" and government ideology
• Algorithm details and training data subject to security review
• Real-name verification required for users
• Government can demand algorithm adjustments at any time :::

Overview of China's AI Regulatory Framework

Three-Pillar Structure

China's AI governance rests on three interconnected regulatory pillars:

1. Algorithm Governance

• Algorithm Recommendation Regulations (effective March 2022)
• Covers recommendation algorithms, ranking algorithms, filtering algorithms
• Requires registration, labeling, and user control mechanisms

2. Content Security

• Deep Synthesis Regulations (effective January 2023)
• Generative AI Measures (effective August 2023)
• Governs AI-generated content (text, images, video, audio)
• Requires content security management and illegal content filtering

3. Data Governance

• Data Security Law (September 2021)
• Personal Information Protection Law (November 2021)
• Critical Information Infrastructure Security Protection Regulation (September 2021)
• Cross-border data transfer restrictions

Regulatory Authorities

Primary Regulator: Cyberspace Administration of China (CAC)

• Central authority for internet content and data security
• Issues regulations and conducts enforcement
• Manages algorithm registration system
• Coordinates with other ministries

Supporting Authorities:

• Ministry of Industry and Information Technology (MIIT) - technical standards
• Ministry of Public Security (MPS) - cybersecurity and criminal enforcement
• State Administration for Market Regulation (SAMR) - consumer protection and competition
• Ministry of Science and Technology (MOST) - AI development policy

:::statistic{value="850+" label="AI Algorithms Registered" description="Number of algorithms registered with CAC as of December 2023, including systems from Baidu, Alibaba, Tencent, ByteDance"} :::

Algorithm Registration Requirements

What Must Be Registered

Internet Information Service Algorithm Registration (March 2022):

Mandatory Registration Triggers:

• Recommendation algorithms (content, products, search results)
• Ranking and filtering algorithms
• Selection and push algorithms
• Dispatch and decision-making algorithms
• Used for public opinion mobilization or opinion formation
• Significant social influence or public opinion properties

Examples:

• Social media content recommendation
• E-commerce product recommendations
• Search result rankings
• News aggregation and filtering
• Ride-hailing driver dispatch
• Content moderation algorithms

Exemptions (Limited):

• Internal enterprise systems not facing public users
• Pure infrastructure algorithms (data compression, encryption)
• Simple chronological or alphabetical sorting without personalization

Registration Process

Step 1: Prepare Documentation (60+ day timeline)

Required Materials:

• Algorithm mechanism description (input, logic, output)
• Application scenarios and user scale
• Security self-assessment report
• Content security management measures
• User rights protection mechanisms
• Data sources and processing methods
• Algorithm training data description
• Potential risks and mitigation measures
• Legal representative identity verification

Step 2: Submit to Provincial CAC Office

• Registration through local CAC office in province of operation
• Initial review: 10 working days
• Request for additional materials: Common

Step 3: Security Assessment (If Required)

Triggered if algorithm:

• Serves >100 million users annually
• Has significant opinion formation capabilities
• Involves sensitive content categories
• Determined necessary by CAC

Assessment includes:

• On-site inspection of facilities and systems
• Review of algorithm logic and training data
• Testing of content filtering capabilities
• Verification of user protection mechanisms
• Political/ideological content review

Step 4: CAC Review and Approval

• National CAC reviews registration
• Can request modifications to algorithm design
• Can require additional security measures
• Issues registration number upon approval
• Typical total timeline: 2-4 months

Step 5: Public Filing

• Approved algorithms listed on CAC public registry
• Filing number must be displayed in service
• Annual updates required

Ongoing Compliance Obligations

Annual Reporting:

• Algorithm changes and updates
• User scale and engagement metrics
• Content security incidents
• User complaints and resolutions

Real-Time Obligations:

• Report security incidents within 24 hours
• Respond to government information requests within 48 hours
• Implement government-ordered algorithm adjustments immediately
• Maintain logs for 6 months (3 years for sensitive content)

User Transparency:

• Clear labeling when algorithm-driven content is displayed
• Explanation of recommendation logic in accessible language
• User controls to disable or adjust recommendations
• Easy access to chronological/non-algorithmic views

:::keyInsight{title="Government Override Power"} CAC retains authority to order algorithm modifications at any time to address "public opinion risks," "social stability concerns," or violations of "socialist core values." Operators must comply immediately or face service suspension. :::

Generative AI Specific Requirements

Generative AI Measures (August 2023)

China was one of the first countries to regulate generative AI specifically.

Scope:

• Text generation (chatbots, writing assistants)
• Image generation (DALL-E-style systems)
• Audio generation (voice synthesis, music)
• Video generation (deepfakes, video synthesis)
• Code generation

Pre-Launch Requirements:

1. Security Assessment (Mandatory)

• Conducted before public service launch
• Submit to provincial CAC for national review
• Includes algorithm security, data security, content security
• Can take 3-6 months

2. Algorithm Registration

• Follow standard algorithm registration process
• Additional requirements for generative AI:
  • Training data sources and legality verification
  • Content filtering mechanisms
  • Watermarking and traceability systems
  • User identity verification integration

3. Service Provider Responsibilities

Content Security Management:

• Pre-training data review for illegal/harmful content
• Real-time generation monitoring and filtering
• Post-generation content review and takedown
• User content reporting mechanisms

Prohibited Content (Must Be Filtered):

• Subversion of state power or socialist system
• Endangering national security or interests
• Undermining national unity or social stability
• Spreading terrorism or extremism
• Ethnic hatred or discrimination
• Obscenity, violence, or illegal content
• False information that disrupts economic/social order

Data and Privacy:

• Training data must be legally sourced
• Personal information used with consent
• Respect intellectual property rights
• Implement data security protection measures

User Requirements:

• Real-name registration (linked to Chinese ID or phone number)
• Accept terms prohibiting misuse
• Age verification for minors

Labeling and Transparency:

• AI-generated content must be clearly labeled
• Cannot fabricate false information
• Cannot impersonate real persons without consent
• Watermarking required for generated images/videos

Enforcement for Generative AI

Violations and Penalties:

Service Without Approval:

• Service suspension or ban
• Fines: 10,000-100,000 RMB ($1,400-$14,000)
• Confiscation of illegal gains

Content Security Violations:

• Immediate content removal orders
• Service suspension (temporary or permanent)
• Fines: Up to 10% of prior year's revenue
• Criminal liability for serious cases

Data/Privacy Violations:

• Fines under PIPL: Up to 50 million RMB or 5% annual revenue
• Suspension of data processing activities
• Revocation of business licenses for serious violations

:::callout{type="danger" title="Criminal Liability Risk"} Operators and responsible individuals can face criminal charges for:

• Refusing to implement government-ordered content removal
• Spreading large amounts of illegal information
• Causing serious social harm or economic losses
• Criminal penalties include imprisonment up to 7 years :::

Deep Synthesis (Deepfakes) Regulations

Deep Synthesis Provisions (January 2023)

Targets synthetic media creation and distribution.

Covered Technologies:

• Face swapping and manipulation
• Voice synthesis and cloning
• Immersive scene generation (virtual environments)
• Any technology generating or editing images, audio, video with synthesis

Service Provider Obligations:

1. Registration and Labeling

• Register with CAC as deep synthesis service provider
• Clearly label synthesized content with permanent marker
• Cannot use deep synthesis to produce illegal content

2. User Verification

• Real-name verification for content creators
• Verify identity of persons being synthesized (face, voice)
• Obtain consent for use of person's likeness or voice
• Authenticate information sources used in synthesis

3. Technical Measures

• Add permanent markers (watermarks, metadata tags)
• Implement content review and filtering
• Maintain traceability for synthesized content (logs, source data)
• Provide detection tools for synthesized content

4. Content Management

• Review generated content before release
• Respond to takedown notices within 24 hours
• Report illegal content to authorities
• Preserve evidence for 6 months

Prohibited Uses:

• Creating fake news or false information
• Impersonating others without consent
• Infringing on personal image, reputation, or rights
• Harming national security or public interest
• Committing fraud or other illegal activities

Data Governance Requirements

Data Security Law & PIPL Compliance

Data Localization:

• Critical Information Infrastructure (CII) operators must store personal data in China
• Cross-border data transfers require security assessment by CAC
• Important data and personal data >1 million users requires approval

AI-Specific Data Issues:

Training Data:

• Must verify legal source and rights to use
• Personal data requires consent (purpose-specific)
• Sensitive personal data requires separate consent
• Biometric data (faces, voices) subject to strict controls

Data Processing:

• Principle of minimization (only necessary data)
• Clear purpose specification
• Transparent processing (user notice)
• Security safeguards (encryption, access controls)

Cross-Border Data Transfer:

Required approvals for:

• Transferring personal data abroad
• Transferring important data (including AI model parameters/weights)
• Providing data to foreign governments or organizations

Approval Process:

• Security assessment by CAC (for CII operators or large volumes)
• Personal information protection certification (alternative for smaller operators)
• Standard contracts (limited application for AI)
• Typical timeline: 6-12 months for security assessment

Special Categories: Biometric and Sensitive Data

Facial Recognition:

• Requires separate consent with clear purpose
• Must provide non-biometric alternatives
• Cannot be used for discrimination
• Subject to heightened security requirements

Voice Data:

• Consent required for voice cloning or synthesis
• Protection against unauthorized voice capture
• Clear labeling of synthesized voice content

Children's Data (Under 14):

• Parental consent required
• Purpose limitation and minimal processing
• Cannot be used for personalized recommendations (with exceptions)
• Enhanced security protections

Practical Compliance Strategy

Phase 1: Market Entry Assessment (Before Launch)

Regulatory Mapping:

• Identify all regulations applicable to your AI system:
  • Algorithm registration? (User-facing algorithms)
  • Generative AI measures? (Content generation)
  • Deep synthesis? (Synthetic media)
  • Data security assessment? (Cross-border data, >1M users)
• Determine if CII operator designation applies (common for large platforms)

Timeline Planning:

• Algorithm registration: 2-4 months
• Generative AI security assessment: 3-6 months
• Data security assessment (if required): 6-12 months
• Total pre-launch: 6-12+ months for complex systems

Local Entity Requirement:

• Must have Chinese legal entity to register algorithms and obtain approvals
• Consider WFOE (Wholly Foreign-Owned Enterprise) structure
• Local entity must have Chinese national as legal representative in some cases

Phase 2: Technical Implementation

Content Filtering:

• Implement keyword filtering for prohibited content
• Use CAC-approved content moderation technology
• Real-time monitoring and pre-publication review for generated content
• Maintain prohibited content database (updated with CAC guidance)

User Identity Verification:

• Integrate with Chinese ID verification services
• Mobile phone number verification (Chinese numbers linked to ID)
• Real-name backend storage (can use pseudonyms publicly)
• Enhanced verification for content creators vs. consumers

Labeling and Transparency:

• Clear algorithm-driven content labels in UI
• AI-generated content watermarks and metadata
• User controls for algorithm preferences
• Explanation pages for recommendation logic

Data Localization:

• Server infrastructure in China for Chinese user data
• Separate data storage for Chinese vs. international users
• Encryption for data at rest and in transit
• Access controls limiting cross-border access to Chinese data

Audit Trail:

• Comprehensive logging (user actions, content generation, algorithm decisions)
• 6-month retention (3 years for sensitive content)
• Immediate retrieval capabilities for government requests
• Tamper-proof log storage

Phase 3: Registration and Approval

Documentation Preparation:

• Engage Chinese legal counsel specializing in cybersecurity/data law
• Prepare all required materials in Chinese
• Conduct pre-filing security self-assessment
• Anticipate multiple rounds of clarifications and revisions

Agency Engagement:

• Submit through local CAC office (province of operation)
• Maintain responsive communication (48-hour response expectations)
• Be prepared for on-site inspections
• Demonstrate technical capabilities and security measures

Political/Content Sensitivity:

• Avoid sensitive topics in training data and outputs (politics, Xinjiang, Tibet, Taiwan, human rights)
• Demonstrate alignment with "socialist core values"
• Show proactive content filtering and moderation
• Highlight positive social contributions of AI system

Phase 4: Ongoing Operations

Continuous Monitoring:

• Real-time content filtering and flagging
• Regular algorithm audits and performance reviews
• User complaint tracking and resolution
• Security incident detection and response

Government Coordination:

• Respond to information requests within 48 hours
• Implement algorithm adjustment orders immediately
• Participate in CAC-organized trainings and briefings
• Proactive reporting of significant issues

Annual Compliance:

• Submit annual algorithm registration update
• Renew security assessments (if applicable)
• Update documentation for regulatory changes
• Conduct internal compliance audits

Crisis Management:

• Designated government liaison team (24/7 availability)
• Rapid response procedures for content incidents
• Escalation protocols for sensitive issues
• Public relations coordination with government messaging

Key Differences from Western Regulations

China vs. EU AI Act

China vs. US Regulations

:::callout{type="info" title="Strategic Implications"} Operating AI in China requires:

• Accepting government as co-pilot in algorithm design
• Building China-specific versions with localized compliance
• Separate data architecture and infrastructure
• Local management team with government relations expertise
• Long lead times for approvals (factor into product roadmaps) :::

Key Takeaways

1. China requires pre-launch government approval through algorithm registration, security assessments, and CAC review before AI services can be offered to Chinese users.

2. Content must align with government ideology - systems must filter content that undermines state power, social stability, or socialist core values, with operators facing criminal liability for serious violations.

3. Real-name user verification is mandatory for all AI services, linked to Chinese national ID cards or phone numbers, with no anonymous usage permitted.

4. Data must remain in China with cross-border transfers requiring CAC security assessment (6-12 months), particularly for personal data, critical information infrastructure operators, or data affecting national security.

5. Government retains override authority to order algorithm modifications, content removal, or service suspension at any time, with operators required to comply immediately.

6. Compliance timelines are long - expect 6-12+ months from initial planning to service launch when factoring in registration, security assessments, and technical implementation.

7. China's approach fundamentally differs from Western regulations - emphasizing state security and ideological alignment over user rights and market dynamics, requiring AI systems built specifically for the Chinese market.

Frequently Asked Questions

Can foreign companies register algorithms in China without a local entity?

No. Algorithm registration and security assessments require a Chinese legal entity (typically a Wholly Foreign-Owned Enterprise or joint venture). The local entity must have business operations, technical infrastructure, and personnel in China to be eligible for registration.

How long does the algorithm registration process take?

Typical timeline is 2-4 months for standard algorithm registration without security assessment. Add 2-4 months if security assessment is required (for high-impact algorithms or those serving >100 million users annually). Generative AI security assessments can take 3-6 months. Plan for 6-12+ months total pre-launch timeline.

What happens if we launch without registration?

CAC can issue immediate service suspension orders, impose fines (10,000-100,000 RMB for algorithm violations, up to 10% annual revenue for content violations), confiscate illegal gains, and in serious cases, pursue criminal charges against responsible individuals. Authorities actively monitor for unregistered services.

Can we use the same AI model for China and international markets?

Not recommended. China-specific requirements (content filtering, real-name verification, data localization, government access, ideological alignment) typically require a separate China version. Most companies maintain separate model versions, training data, and infrastructure for China vs. international markets.

How do cross-border data transfer restrictions affect AI training?

Training AI models on Chinese user data typically requires keeping data and training infrastructure in China. Transferring training data, model parameters, or even model outputs abroad may trigger CAC security assessment requirements. Most companies train China-specific models domestically and avoid cross-border data transfers.

What are "socialist core values" and how do we ensure compliance?

Socialist core values refer to 12 principles promoted by the Chinese government: prosperity, democracy, civility, harmony, freedom, equality, justice, rule of law, patriotism, dedication, integrity, and friendship. In practice, this means avoiding content that: criticizes the Party or government, discusses sensitive political topics (Xinjiang, Tibet, Tiananmen), promotes Western democratic values, or challenges official narratives. Work with Chinese legal counsel and content moderation experts for specific guidance.

How does enforcement actually work in practice?

CAC conducts proactive monitoring (automated and manual) of registered services, responds to user complaints, and performs periodic inspections. Enforcement is often informal initially (verbal warnings, requests for corrections) but can escalate quickly to formal penalties for non-compliance or politically sensitive issues. Maintaining good relationships with local CAC offices and demonstrating responsiveness to informal guidance is critical.

Citations

1. Provisions on the Administration of Algorithmic Recommendations in Internet Information Services (CAC Order No. 9, effective March 1, 2022) - http://www.cac.gov.cn/2022-01/04/c_1642894606364259.htm

2. Provisions on the Administration of Deep Synthesis in Internet Information Services (CAC Order No. 12, effective January 10, 2023) - http://www.cac.gov.cn/2022-12/11/c_1672221949318756.htm

3. Interim Measures for the Administration of Generative Artificial Intelligence Services (CAC Order No. 15, effective August 15, 2023) - http://www.cac.gov.cn/2023-07/13/c_1690898327029107.htm

4. Personal Information Protection Law of the People's Republic of China (effective November 1, 2021) - http://www.npc.gov.cn/npc/c30834/202108/a8c4e3672c74491a80b53a172bb753fe.shtml

5. Data Security Law of the People's Republic of China (effective September 1, 2021) - http://www.npc.gov.cn/npc/c30834/202106/7c9af12f51334a73b56d7938f99a788a.shtml