Spooked by Chinese spying, world’s largest asset management company BlackRock tells its employees not to carry company laptops or mobiles to China
A new restriction has been imposed by BlackRock on its employees over electronic devices while traveling to China. It allowed them to use temporary loaner phones and prohibited them from carrying the company’s laptops during any business trip to China.
BlackRock, the world’s largest asset manager, detailed the “policy enhancement” in an internal memo effective July 16, as per a Bloomberg report. It barred the employees from using BlackRock-issued iPhones, iPads, Laptops, and remote access via private network while staying in China. They will additionally lose access to the BlackRock network during personal travel to the country.
By enforcing these restrictions, BlackRock aims to mitigate potential data breaches and ensure adherence to local regulations, a crucial step given the increased scrutiny on foreign firms operating in China.
US-China tensions the trigger
This significant move reflects a way to alleviate any unnecessary tension that can be linked to the company. China has been in the spotlight with the geopolitical tensions between Washington and Beijing, which continues to strain international business relationships.
The move didn’t come out of the blue; it was preceded by a series of incidents involving Western businesses being prevented from leaving China. Beijing’s Foreign Ministry described it as a criminal matter after Wells Fargo suspended travel to China last week and one of its senior trade financing bankers, Chenyue Mao, was blocked from departing the country.
China has also done something similar by restricting a US patent and Trademark Office employee from leaving during a personal visit earlier this month. While a US Commerce Department worker has reportedly faced hurdles in leaving China for several months
Data security challenge
The global companies have met with many struggles to balance operational needs with compliance requirements since China implemented stricter data security laws in 2021. They found difficulty in establishing onshore data centers to keep Chinese information within the country, adding significant costs and complicating business management.
BlackRock continues to have a strong foothold in China through its fully owned mutual fund company and a wealth management joint venture with China Construction Bank Corp. Its updated travel policy highlights the growing difficulties global financial firms face as regulatory and security complexities intensify between the US and China.
Meanwhile, Amazon is closing its AI lab in Shanghai due to escalating geopolitical tensions. Established in 2018, the lab produced over 100 academic papers and played a key role in developing a neural network framework that reportedly contributed nearly $1 billion in sales, according to a lab scientist.
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