China unveils final version of generative AI rules

China has released its official guidelines for generative AI services in one of the world’s first moves to regulate advanced technology.

The rules spearheaded by the Cyberspace Administration of China, the country’s top internet overseer, will come into effect from August 15, according to an official statement on Thursday. Among the 24 provisions are requirements for platform providers to conduct a security review and register their services with the government, as laid out in a draft version released in April.

The final guidelines state that overseas providers of generative AI tools, if they target Chinese residents, must also abide by the set of rules. On the other hand, if tools developed by China only serve users abroad, they will not be subject to the Guidelines.

“This means that more opportunities will be in enterprise-facing applications and people will be more cautious about consumer-facing entrepreneurship,” Francis Du, co-founder of J Ventures, told Bloomberg.

The guidelines also remove provisions in the draft version that included fines of up to 100,000 yuan ($14,000) for violations, as well as requiring platform operators to work within a 3-month grace period to correct problematic content.

The guidelines also list agencies including the National Development and Reform Commission, the country’s Ministry of Education, and the Ministry of Science and Technology as joint issuers of the regulation, along with articles encouraging developers of AI models and software to help set international standards and pursue technology exchanges.

The move comes after months of consultations between the government and industry players. China’s major Internet companies, from Alibaba Group Holding Group to Baidu and, have rushed to platforms equivalent to OpenAI’s ChatGBT.

Legal experts raised concerns after the draft version of the regulations, saying it placed the bulk of responsibility for managing AI content on platform operators. The fear is that too tight regulations could limit the industry’s development, at a time when China is seeking to catch up and overtake the US in technology that is at the heart of their strategic competition.

Yu Chuanman, director of the Institute of International Internal Auditors’ International Center for Regulation and Global Governance at the University of Hong Kong, said the final version of the regulations appeared to allow for greater flexibility by easing details in the grace period and focusing more on promoting development.

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