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Shanghai city has now issued draft regulations in a bid to safeguard data that are being generated during the testing of smart vehicles which underscores China’s growing concern about data security.

There was a statement issued on Friday by the Shanghai Economic and Information Technology Commission that it will now require entities conducting vehicle testing and demonstrations to properly handle the acquisition, processing, application, and transmission of data.

The data generated during the testing and demonstration activities will not be permitted to be transmitted overseas unless approved by relevant authorities adding the draft laws are open for public consultation.

The entities should also take relevant measures in order to protect data confidentiality, form a personal information protection system as well as forbid the conduction of illegal trading, trading, and disclosure of relevant data.

With the new rules, a large number of automakers and startups within the automotive industry in the Chinese market such as Didi Global, WeRide, and other internet-based service providers such as Baidu are all working towards the self-driving vehicle technology which is expected to bring a dramatic change to the automotive industry at large.

China, on one hand, wants to revamp its policy towards privacy and data security as it drafting the Personal Information Protection Law and its also set to implement in September its Data Security Law which requires companies that process critical data to conduct risk assessments and submit those reports.

The country’s Ministry of Industry and Information Technology earlier issued a draft action plan to develop the country’s cyber-security industry in a bid to better govern data storage, data transfer, and personal data privacy.

Regulators announced a probe into ride-hailing giant Didi in early July, just days after its listing in New York, and subsequently ordered its app to be removed from app stores. They cited “serious violations” of laws and regulations pertaining to the collection of personal information by Didi’s app.