The Mainland of China is a key business and economic partner to Hong Kong. As such, there is significant demand for secure data centre facilities to house the information technology (“IT”) infrastructure that drives Mainland and global business operations.
The IT industry is a key contributor to the economy of Hong Kong, accounting for over half of total employment. In addition, it is also the driving force behind a burgeoning service sector which includes financial services & insurance and trading & logistics. These industries are in turn fueled by increased demand for data centre space to accommodate the growing needs of their clients.
These factors have made Hong Kong the world’s leading data centre hub, attracting over 1,000 companies to establish data centres here in recent years. The rapid growth of the data centre industry has also been facilitated by increasing government investment to promote digital infrastructure development in Hong Kong.
While Hong Kong’s IT sector is thriving, the country faces many challenges that could affect its competitiveness, including rising labour costs, an ageing workforce and a limited talent pool. One of the most important challenges is to address the shortage of skilled IT professionals. In particular, it is necessary to attract more IT talents from overseas and provide training opportunities for local IT professionals.
To support the IT industry, the Hong Kong government has set up an IT Training Fund to subsidise training and education for IT professionals. This will help to reduce the shortage of IT talents in Hong Kong and ensure that the IT industry remains competitive globally.
Aside from training, the government is also promoting policies to encourage IT startups and innovation. This includes providing tax incentives to encourage IT startups and establishing a new “innovation and technology” category in the tax incentive scheme. These incentives will enable IT startups to benefit from a more favourable tax environment and improve Hong Kong’s business climate.
Several countries have introduced measures to stimulate the growth of the IT industry and increase the number of IT professionals. In Europe, for example, there is a new European Union (“EU”) law called the General Data Protection Regulation (the “GDPR”). The GDPR includes measures to protect personal data transferred across borders. It also includes a new right for data subjects to request copies of their personal data.
The PCPD has published two sets of recommended model contractual clauses for personal data transfers. These model clauses cater for either the transfer of personal data between a Hong Kong entity and an entity outside Hong Kong, or the transfer of personal data between two entities both of which are outside Hong Kong and controlled by the same Hong Kong data user. Both scenarios require the data exporter to comply with the PDPO and its six DPPs, as well as to carry out a transfer impact assessment for the destination jurisdiction. This assessment should identify any supplementary measures that are needed to bring the level of protection in the destination jurisdiction up to Hong Kong standards.