Emerging sectors drive new laws, amendments

China Daily Global Updated: 2023-01-11

Legislators and judicial professionals are mulling ways to deal with questions prompted by the rise of internet- and tech-related businesses. 

Will the act of broadcasting movies or television programs via livestreams be considered an infringement of copyright protection law? Will ride-hailing drivers be compensated by online platforms if their rights are infringed by work-related injuries? How can personal information be protected in this era of big data?

These and a number of other related legal issues have sprung up as a result of the rapid development of emerging tech-based businesses in China. They have become a major part of advancing the rule of law and also brought new challenges for judicial professionals.

Li Zongsheng, a lawyer from Liaoning province, attaches great importance to these new issues.

"Problems concerning new fields — such as data security, cybersecurity, the platform economy, livestreaming, express delivery — are closely related to every resident and are inseparable from the nation's sustainable growth," he said.

Li, who is a deputy to the National People's Congress, China's top legislative body, added that it is essential to respond to public concerns via the rule of law.

"Only in this way can the new industries be regulated so as to further promote the healthy development of industry and improve people's sense of security, fulfillment and happiness," he said.

In October, Xi Jinping, general secretary of the Communist Party of China Central Committee, delivered a report to the 20th National Congress of the CPC. He highlighted the significance of practicing law-based governance on all fronts and advancing the rule of law.

He also stressed the need to follow the path of socialist rule of law with Chinese characteristics, emphasizing that it is vital to give greater play to its role in consolidating foundations, ensuring stable expectations and delivering long-term benefits.

He also called for a greater focus on legislation in key emerging fields and those related to business overseas, adding that it is essential to improve governance and development through sound legislation.

Legislative steps

During the past decade, the NPC and its standing committee have stepped up efforts to produce laws that will prevent problems in emerging industries.

For example, since the 18th CPC National Congress in 2012, legislators have drafted and revised more than 20 laws related to areas of nontraditional security including the cybersecurity law, the data security law, the e-commerce law and the personal information protection law.

"The new laws and amendments aim to solve fresh security problems facing the country and also form a national security legal system that suits the State's strategic security environment," said Xu Anbiao, deputy head of the NPC Standing Committee's Legislative Affairs Commission.

After many people fell victim to telecom and online fraud, legislators strengthened punishments for swindlers by revising the criminal law and also introduced the nation's first law focused on fraud-related cases.

"We've also provided heavier penalties and added new criminal charges while revising the criminal law in response to people's concerns in other fields, such as corruption, financial security, public security, food safety, environmental protection and intellectual property," Yue Zhongming, a spokesman for the commission, said.

Li, the lawyer in Liaoning, welcomed the new measures, but added that making or amending laws is a lengthy process that sometimes fails to keep pace with new issues "so solving problems involving emerging businesses presents challenges to legal practice".

Seeking a balance

In 2021, Li Lisha, a judge at the Beijing Haidian District People's Court, resolved a copyright case in which iQiyi, a leading online video platform, claimed that a user of Huya, a provider of streaming services, had privately broadcast one of its works, Nirvana in Fire, a domestic costume drama, via an illegal livestream.

The person responsible was easily identified as a copyright violator because evidence showed that he had failed to obtain permission from iQiyi to broadcast the drama.

"However, whether Huya should be held liable for the infringement was an issue that needed further consideration," Li Lisha said.

After an investigation, the court clarified Huya's liability status and ordered the company to pay iQiyi compensation of about 230,000 yuan ($33,400) as it should have been aware of the infringement and taken action to stop it.

"We found that the violator received abundant online views after broadcasting the drama for almost a month on a special channel established by Huya for people to watch TV series and movies," the judge said.

"Although the livestreaming room was named after actors in the drama instead of directly using the name of the TV series, Huya should have noticed the infringement due to the large number of views and the monthly playtime. In other words, Huya assisted the infringement, so it should be punished."

However, she said whether an online service provider is held accountable mainly depends on whether it performs its management duties correctly and has the ability to identify irregularities on its platform.

"The problem concerning emerging sectors like livestreaming has been frequently seen in cases related to IP(intellectual property)," she said, adding that the big challenge is to solve issues via the existing laws, which have few provisions targeting emerging industries. She conceded that such new-style disputes raise new requirements for the judiciary.

"They demand that we better balance the interests of all parties when delivering a verdict," she said.

"Simply put, we cannot hamper the potential driving force of new businesses while regulating them, nor can we ignore the interests of the holders of the rights."

Research rising

Data released by the National Bureau of Statistics last year show that about 200 million people in China were in flexible employment, with a rising number engaged in new sectors, such as express delivery, ride-hailing services and livestreaming.

Wang Yan, another judge at the Beijing court, always follows the statistics, saying it is a must for judicial professionals to embrace the internet. "The more we understand about how online services work, the more effectively we can resolve related disputes," she said.

In a case Wang handled in 2018, a woman surnamed Ge, who was working as a driver for a ride-hailing company, lost consciousness as she responded to an order to pick up a customer at 11:50 pm on Sept 30 that year. Having lost control, Ge was killed when her car collided with other vehicles.

Her family members claimed that Ge's death was work-related, and applied for compensation from the company. However, it refused on the grounds that it didn't have an employer-employee relationship with Ge.

Unable to reach an agreement, the two sides turned to the court.

An investigation by the court found that Ge had not signed an employment contract with the platform, and under the business operating model she had the right to decide when to start providing her services and whether to accept orders assigned by the platform.

Wang said that meant the platform could not force Ge to provide the services, but it could lower her customer scores through an algorithm if she consistently declined assigned orders. The lower scores would make it difficult for her to receive orders later on.

Based on the findings, the court identified a flexible labor relationship between Ge and the platform, rather than stable, long-term employment in which workers are strictly managed by employers and receive pay or medical insurance if they have work-related injuries.

Although the relationship could not be legally proved, Wang said in her ruling that the improper approach of the service — lowering scores provided by customers if drivers refused to accept assigned jobs — should be noted.

She called on the platform to shoulder more responsibility by improving its business operations and to optimize the service pattern to further protect people's personal safety and traffic safety.

She noted that new sectors have played a major role in advancing sustainable and high-quality economic growth "but that doesn't mean they can develop in a disorderly fashion".

She added that the healthy development of new industries contributes to promoting employment and maintaining social stability. That means judges need to conduct more research on cases involving such sectors, especially those that use algorithms and related operating models because that would help identify the root causes of disputes.

NPC deputy Li Zongsheng agreed, saying that such studies would help advance legislation. "People's rights and interests will be better protected if a sound legal environment can be established," he said.

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