BEIJING (Reuters) – Apple Inc on Wednesday said it is setting up its first data center in China, in partnership with a local internet services company, to comply with tougher cyber-security laws introduced last month.
The U.S. technology company said it will build the center in the southern province of Guizhou with data management firm Guizhou-Cloud Big Data Industry Co Ltd (GCBD).
An Apple spokesman in Shanghai told Reuters the center is part of a planned $1 billion investment into the province.
“The addition of this data center will allow us to improve the speed and reliability of our products and services while also complying with newly passed regulations,” Apple said in a statement to Reuters.
“These regulations require cloud services be operated by Chinese companies so we’re partnering with GCBD to offer iCloud,” it said, referring to its online data storage service.
Apple is the first foreign firm to announce amendments to its data storage for China following the implementation of a new cyber-security law on June 1 that requires foreign firms to store data within the country.
Overseas business groups said the law’s strict data surveillance and storage requirements are overly vague, burdening the firms with excessive compliance risks and threatening proprietary data.
Authorities say the law is not designed to put foreign firms at a disadvantage and was drafted in reaction to the threat of cyber attacks and terrorism.
Apple also said it had strong data privacy and security protections in place.
“No backdoors will be created into any of our systems,” it said.
In April, China also announced a law requiring businesses transferring over 1,000 gigabytes of data outside China to undergo yearly security reviews, with potential blocks on exporting economic, technological and scientific data.
Earlier this week, Apple said it planned to open a new data center in Denmark. An earlier center in the country, announced in 2015, will come online this year, it said.
The new laws come as Chinese cloud firms are expanding rapidly in foreign markets. Alibaba Group Holding Ltd has 17 data centers across China, the United States, Europe, Australia, Southeast Asia and the Middle East.
Other foreign firms that oversee cloud businesses, including Amazon.com Inc and Microsoft Corp, already have data centers in China.
(Reporting by Cate Cadell; Writing by Brenda Goh; Editing by Himani Sarkar and Christopher Cushing)