Chinese IT giants have exposed to local authorities secret algorithms responsible for their applications

Chinese IT giants have exposed to local authorities secret algorithms responsible for their applicat

In China, an extraordinary event took place: local IT giants, ranging from Tencent Holdings to ByteDance, for the first time provided the authorities with information about the algorithms on which their systems operated. Experts do not rule out that such measures are theoretically likely to compromise the strictest protected corporate secrets.

On Friday, the local regulator published a list of 30 algorithms that companies like Alibaba Group Holding and Meituan use to collect user data, make personal recommendations and work with content. Only short descriptions of algorithms are available to the public, but the authorities have received much more information.

Algorithms that rank when video is released at TikTok, WeChat or Instagram* posts are often seen as a "secret ingredient" essential to attracting users' attention and as a factor of business growth. However, Chinese companies have no choice, as reported by Bloomberg, in March, in Sky in response to complaints of data abuse, passed a law requiring Internet companies to disclose information about such instruments.

The mechanisms that govern the industry are kept in strict secrecy and are often subject to political debate and speculation around the world. In China, technogiants have failed to defend their secrets — unlike, for example, the US, where Meta* and Alphabet have retained their right not to disclose such information on the basis of commercial secrecy.

China's Cyberspace Administration still requires only basic information, but may also request additional information if companies are accused of abuse. Publication of the List means, among other things, that the process of interaction between the authorities and technogiants is still quite smooth.

While IT companies had previously expanded almost uncontrolledly in the country, in recent years the authorities had begun to tighten their policy of interaction with business, including the adoption of the Personal Information Protection Act last year, as well as the Data Security Act, which strengthened the rules for the processing of user information.

The list of algorithms is already publicly available, but only contains brief information. For example, ByteDance reports that its algorithm uses likes and diesels to make recommendations in its applications, in particular, a Chinese relative, TikTok — Dowyin. Meituan stated that algorithms help her distribute food orders between couriers depending on the time of stopover and the route of delivery.

Under the new regulations, companies are required to provide CAC and more detailed information, including the results of an independent audit of algorithm safety, information on the data collected, including whether biometric information is collected and what databases are used to train algorithms. It is reported that the competent authorities will keep up to date the list of information required to provide information. For the time being, it is known that the information provided by CAC includes some of the data that constitute a commercial secret, which, of course, cannot be shared with the public.

* Listed on the list of voluntary associations and religious organizations in respect of which the court has taken a legally enforceable decision to abolish or prohibit activities on the grounds provided for in Federal Act No. 114-FZ of 25 July 2002 on countering extremist activities.