Australia: Entry into force of Regional Comprehensive Economic Partnership including data localisation prohibition (Article 12.14)

On 1 January 2022, the Regional Comprehensive Economic Partnership (RCEP) entered into force for ten original parties: Australia, Brunei Darussalam, Cambodia, China, Japan, Laos, New Zealand, Singapore, Thailand and Vietnam. The RCEP was signed by Australia, Brunei, Cambodia, China, Indonesia, Japan, South Korea, Laos, Malaysia, Myanmar, New Zealand, the Philippines, Singapore, Thailand, and Viet Nam. Chapter 12 of the RCEP regulates Electronic Commerce. In particular, Article 12.14 on Location of Computing Facilities recognises that the parties may have their own measures on the use or location of computing facilities, including requirements that seek to ensure the security and confidentiality of communications. However, the provision prohibits the parties from requiring businesses to use or locate computing facilities in their territory as a condition for conducting business. Notwithstanding, the provision allows parties to (a) adopt or maintain measures necessary to achieve a legitimate public policy objective, provided that the measure is not applied in a manner which would constitute a means of arbitrary or unjustifiable discrimination or a disguised restriction on trade; or (b) measures necessary for the protection of its essential security interests. Cambodia, Lao, and Myanmar are not required to comply with obligations of the Article for a period of five years after the date of entry into force of the RCEP, with an additional three years if necessary. Viet Nam is not required to comply with obligations of the Article for a period of five years after the date of entry into force of the RCEP.