Japan to restrict Chinese cloud services for critical sectors

The Japanese government is set to effectively exclude Chinese-based cloud services from critical infrastructure sectors, including finance and healthcare, to protect sensitive data. Under new regulations scheduled to take effect in fiscal year 2027, only government-approved servers will be permitted for use in these vital industries.

The move aims to mitigate risks associated with China’s National Intelligence Law, which mandates that organizations and citizens cooperate with state intelligence activities. To ensure security, the government will implement strict checks on capital relationships to prevent foreign government influence over data infrastructure. This policy shift follows concerns that even with local data centers, such as those operated by Alibaba Cloud, data could potentially be accessed by foreign authorities under legal compulsion.