China has just announced a new social credit law. Here’s what it says.

To this end, the latest draft legislation talks about the need to use “methods as diverse as statistical methods, modeling and field certification” to conduct credit assessments and combine data. data from various government agencies. “It just gives the faintest hint that it’s a bit tech-savvy,” says Daum.

How are Chinese tech companies participating in this system?

Because the system is so low-tech, the involvement of Chinese tech companies is peripheral. Shazeda Ahmed, a postdoctoral researcher at Princeton University who has spent years in China studying how tech companies participate in the social credit system, said: Big tech and small tech… play very different roles and they implement very different strategies. .

Smaller companies, contracted by city or provincial governments, mainly build the technology infrastructure of the system, such as databases and data centers. On the other hand, big tech companies, especially social platforms, have helped the system spread its message. Alibaba, for example, help the court makes judgmental decisions through the shipping addresses it collects through its massive e-commerce platform. And Douyin, the Chinese version of TikTok, cooperate with the local court in China to publicly shame individuals who do not comply with court rulings. But these tech giants aren’t really involved in core functions, like contributing data or aggregating credit ratings.

“They treat it almost like a civic responsibility or corporate social responsibility: if you break the law in this way, we will get this data from the Supreme People’s Court and we will punish you. on our platform,” Ahmed said.

There are also Chinese companies, like Ant Group, the fintech arm of Alibaba, that have built private financial credit scoring products. But the result, like Alibaba’s Sesame Credit, is like a loyalty rewards program, according to some scholars. Since Sesame credit score is mainly calculated based on user’s purchase history and lending activities on Alibaba’s own platform, it is not reliable enough for external financial institutions to use and very limited effect on individuals.

With all this in mind, are we still concerned about the impact of building a social credit system in China?

Right. Even without a scary algorithm that scores every citizen, the social credit system can still be problematic.

The Chinese government has emphasized that all penalties related to social credit are subject to existing law, but the law itself may be unjust in the first place. “To say that the system is an extension of the law simply means that it is no better or worse than the laws it enforces. As China increasingly focuses on the cultural and social life of its people, further regulating entertainment, educational and speech content, those rules will also become subject to credit enforcement, ” Daum wrote in an article in 2021.

Furthermore, “this has always been about getting people honest with the government, not necessarily with each other,” says Ahmed. When ethical issues such as honesty become legal issues, the state will have sole authority in deciding who is trustworthy. One tactic that Chinese courts have used to hold “discredited individuals” accountable is to encourage their friends and family to report their assets in exchange for a reward. “Are you making society more believable by criticizing your neighbors? Or are you causing distrust in your own local community?” she asked.

But after all, the social credit system does not (yet) exemplify the abuse of advanced technologies such as artificial intelligence and it is important to evaluate it based on facts. The government is currently seeking public feedback on the November draft document for a month, although there is no tentative date on when it will be passed and become law. It could still take years to see the final product of the nationwide social credit system.

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