 All right, thank you everyone for joining us today both in the room and also somewhere in the ceiling. We're really excited to host this conversation launching Data Sovereignty from the Digital Silk Road to the Return of the State, which is a new open-access volume by Anna Palmchander and Hao Chensun who were excited to have joining us today. We also have copies up front if people are hoping to flip through after the event. And to briefly introduce the authors, Anna Palm is the Scott K. Ginsberg Professor of Law and Technology at Georgetown University, the author of the Electronic Silk Road, and most importantly, a visiting scholar at the Institute for Rebuilding Social Media this year. And Hao Chen is Professor of Law at the University of Hong Kong Faculty of Law and an expert on intellectual property, technology law, and Chinese law. He's also the author of Technology and the Public Interest which was the topic of another great DKC panel last year. So excited to have you back, Hao Chen. Thank you. And we're extremely lucky to have Chinmai Arun in conversation with the authors today. Chinmai is the Executive Director of the Information Society Project and a lecturer in law and research scholar at Yale Law School. Her research focuses on platform governance, social media, algorithm decision-making, the data economy and privacy, all within the larger universe of questions raised by law's relationship with the Information Society. So there's truly no one better that we could have gotten to moderate this conversation today. And with that, I'll hand it over to Chinmai. Firstly, as I was telling Anna Palm when he reached out, I couldn't be more privileged or honored to be the one that gets to do this. And it's very special because actually when I met Anna Palm, he was in Delhi launching the electronics of drugs. So I love the full circle that this makes and you'll know that Bergman is where I started my time at the US. So it's always been very special to me. We just spent the wonderful week in January discussing some related questions as to how it is wonderful for our conference at HKU. And so this really, it couldn't be more special. I am so grateful that you've invited me here to do this. I am going to get to it because I have committed to getting through as many of my questions as I can for the in the first half an hour so that you can talk to the authors. I will not be And so I am proceeding assuming that many of you have not read the book and so I'm going to ask questions that have been answered in it to give you a teaser of what is in it because I promise you will want to read it on a webinar without further ado. In your introduction, you have a wonderful line that I think says a lot about the book. You say when Thomas Hobbes imagined an artificial man in the form of a state, he was not picturing Facebook. And then you go on to define digital sovereignty. Can you tell the audience how you define digital sovereignty and why you came to this definition? Great. Well, first of all, I want to extend my great thanks to Chinmai for the Professor Arun for joining us here. I have admired her for a decade. And so from that meeting in Delhi to many meetings across the world. So so happy that you could join us here today. So I think what I want to do is tell the audience do not buy this book. And so the book can be downloaded for free online. OUP is charging prices really for libraries. I don't know why libraries insist on buying this book. It actually did chart on some Amazon charts for a little bit. I mean, these are very narrow, you know, law charts. And I was like, who is buying this book? You can press the download button. So the poster for this has a QR code, which is the download link. And I know that QR codes are kind of dangerous in many ways, but this is legit. Okay. So returning to your question, Chinmai. So the reference to Hobbes is intended to invoke the image of Leviathan, which of course Hobbes used to reference the state. And so many people have decided have noted that there are a handful of companies today that have Leviathan like powers that kind of the stride the world, you know, in the way that kind of Hobbes described the state. And so there's an artificial man here in the form of this giant corporate these giant corporations. And so they which rival the power of states and to a large extent, the assertion of digital sovereignty or data sovereignty is an attempt to wrestle these Leviathans to the ground, bring them down to earth and hold them to account for domestic law. Okay. So at that level, I think it's a truly understandable and natural response to the emergence of these giant corporations. And so in that sense, it's an effort to bring the digital world within democratic constraints. And in our book, we define digital sovereignty as simply the application of traditional state sovereignty to this digital or online domain, and including the companies, including in that context, the companies that create and provide services in this digital domain. So the fact is that the company could be based in the Caribbean or the United States or China, and we're going to hold it to account in our jurisdiction, regardless. Okay. So I think in that sense, digital sovereignty is a natural and critical part of what it means to have popular sovereignty. So it's directly linked to popular sovereignty in that way, democracy. And much of my own writing is very much animated by, you know, thinking about popular sovereignty. And so what it means in the kind of digital domain today. At the same time, I want to say the book is also concerned about the way that control over the digital domain, whether exercised by Mark Zuckerberg, or President or Premier or Governor General X, can itself raise different concerns. And so this is, this is so we need to be mindful about the way that it's governed, the way that we assert control over it, whether it's done from the by, by Elon or Mark, or Sundar or whomever it is, or take your politician that you are most concerned about and substitute them in that, in any of those names. So I think the, and I just want to make a distinction here, also in the book, we had a lot of trouble actually, is this, we're talking about digital sovereignty or how the data sovereignty, the book title is has kind of both in it. And the book is uses more digital sovereignty than data sovereignty. And so it kind of goes back and forth. I think one can usefully distinguish data sovereignty and digital sovereignty. But they become very hard to disaggregate once you press the concepts. So if you really say, you know, you're focused on controlling data flows or the what data can move in the country, that immediately calls up speech and content regulation, which is often not things that we think about when we think about data sovereignty. And so, you know, I've written a lot about cross border flows of data, which really are another way to see information sharing across borders, right. And so suddenly raises all these issues that are in a totally different domain than we think of as traditional data regulations. So, so I found the two concepts which can be differentiated to be, it's, I think it's, I think it's better to think of them as it's really linked and not try to make such a big distinction between the two. Because when you press them, they kind of merge in a pretty good way. And you see governments that kind of use both concepts. And I did searches within government uses of the term, you know, when does the US government use the term data sovereignty or digital sovereignty. The amazing thing I found in this context is that when the US government used the term, it simply uses the term to reference European unions approach to the internet. It is the Brussels effect in that way, right. And what we describe in the book is that the US never had to worry about data sovereignty or digital sovereignty, because we had it from the very start. Because the companies were based here, we, you know, even when a company would be based in the Caribbean, we prosecute the American who ran that company when he transited through, when he made the mistake of transiting through JFK, or, or picked it, picked him up in Costa Rica, etc. We would, we would, our FBI was very good at figuring out your movements across the world and gathering you from wherever you were. If we thought you're running the foul of US law. We prosecuted a Russian who came to DEF CON to share some information about how he had kind of created a system to allow access to Adobe ebooks early on, because he, because he was allowing you to violate, you know, DMCA controls on, on copyrighted material. He said he was just allowing, and this will be of interest to folks interested in disability questions. He said he was just allowing disabled people to access these ebooks. And so we picked him up when he arrived in Las Vegas. And so we had data from the digital company from the start, whether it was a Russian company or it was a Caribbean company or an American company, we insisted on it from the start. I'll leave it at that and come back to these questions. So I'm going to invite our channel to pitch in, but I'm just, I'm going to layer in my second question, which is that I know that both of you have been friends for a long time and that you've worked together, but I want to invite you to feel back the co-authorial veil and talk a little bit about why you decided to write this book together and how you came to an agreement about what digital sovereignty means as you come from different backgrounds and countries that do things in different ways. So if I can invite you to respond to that. Thank you. So first of all, I also want to thank Berkman Klein Center for hosting today's book launch. As some of you know, I gave a talk on my book, Technology and Public Interest last year here, right here. So it's so great to be back at Berkman Klein Center. And I also want to thank Professor Arun for joining us commenting and discussing about this book with us today. So as you can immediately tell, Anupang is the scholar who knows this subject matter best in the entire world. So there's no question for me that, you know, I never had a doubt about, you know, whether we should collaborate or not, but it's just, you know, flows so naturally. He's the, as I said, he's the scholar who master this subject matter. And so there, but there actually there is a long story that I would like to share with you about, you know, how we come together to collaborate on this project. So it actually, it started from a trip, this grand trip that Anupang made back in 2019 before the pandemic. So he paid a visit to the greater China area, covering Hong Kong and China. And so he first arrived in Hong Kong and we met and then we decided to go to Shenzhen, which is right next to Hong Kong. And then there are a lot, you know, tech companies in Shenzhen. So we went through the borders, physical borders and physical sovereignty, you know, the sovereignty first, then at the immigration. So we, I, you know, cleared the immigration very quickly. But then I waited for Anupang for such a long time. I wonder whether Anupang could actually go through the China's immigration and actually, you know, we could make this visit to multiple tech companies, you know, visit possible. Probably we waited for 30 minutes, 40 minutes, something like that. So that was the moment that we dealt with this kind of physical or traditional sovereignty. China's exercising, you know, sovereignty over this great scholar, you know, I'm not sure how many questions you received from the officer at immigration, but anyway. So we first dealt with this kind of physical sovereignty first, when we were visiting Shenzhen. But then we were, you know, we were lucky that, you know, Anupang made it through. And then we went to visit Tencent and also a bunch of other tech companies. And people there were so eager asking me and Anupang a range of questions about how they should deal with cross-border flow of data, for example, how they deal with data localization in China. But then if they want to do business outside of China, for example, in South Asia, the PNG technology folks asked us a range of questions about how, for example, how they store data in the Philippines, countries like that, you know, how they should deal with another kind of sovereignty, let's say called, as Anupang explained, a data or digital sovereignty. So then we had such vibrant discussion with tech folks there in Shenzhen. So after our visit, we sat down to talk about various issues that we dealt with during the visit. And then Anupang was still struggling with jelly. So, but then immediately after we talked about collaboration, this potential conference, he suddenly became so alert. That was a fantastic moment. We had in Shenzhen, of course, we had such fun, tasty food that I'm sure you can still recall that this kind of data place, data place was a CQ conference that we had in Shenzhen. But then when we started talking about collaboration, Anupang suddenly overcame jelly and we talked about how we should deal with this project. Immediately we thought of hosting a conference together in Hong Kong, because this is a hub where we could put together so many scholars. Hong Kong is really a hub for international travels. So then we planned, but then, as you know, the next year, the pandemic arrived. So then we decided to, we still wanted to do this conference. How could we do it? So we decided to co-host the conference, by the way, it was co-hosted by my school, HKU, and your school, Georgetown University Law Center. So we decided to move this event online, so it became a virtual event. But we were so fortunate that we got two keynote speeches, one delivered by Professor Ma Gu, the Professor here at HK Harvard Law School, and then another keynote delivered by Frank Pasquale, who is now a Professor at Cornell Law School in 2010. And we also put together so many scholars, and if you're interested, you can see their speeches in the book. So we hosted the conference online, and then it took us two years or so to put everything together, because it was so hard to putting things together through the pandemic. People were so, I was me, it was all me. But we're so glad, you know, everything came through. And this is the book, as Anupang pointed out, you don't need to buy the book. It's, you know, we arranged open access. So, and as to the question about how we reached the consensus of concerning various issues, especially the concept of data sovereignty, I feel like there is no disagreement between the two of us, because, you know, Anupang, as you mentioned, you guys mentioned that conference hosted in India, right? Okay. So actually, I first met Anupang here at Harvard Law School, although he was not my professor when he was visiting various law schools, but he, you know, he picked my paper on the social justice IP for this Harvard and International Junior Scholars Conference. So that one was hosted at Harvard Law School. So we actually got to know each other many years ago, and we have talked with so many things ranging from international property to tech law and Anupang cares about international training, that international law and liberal democracy so much. And I feel like I have so much, you know, we have so much in common. So we actually did not have any disagreement. And, but we talked about various kind of things, you know, whether, for example, the book title, whether it should be data sovereignty or data sovereignty. But anyway, it was we had a range of discussion instead of having, you know, various kind of disagreements. Can I just say one of them, just a little, you know, it's really interesting because there's a lot of criticism of China in our in the two chapters that we wrote in this book. And, you know, some of that criticism comes from me that I penned. And I wasn't really sure, you know, how it would be for a scholar, you know, who's based in China to participate in these in that, and to put his name to some of this criticism. It's been fascinating that that hasn't been an issue. I hope I don't make an issue that it's just just as you're thinking about these collaborations, as you're thinking of collaborations, you know, across, you know, fraught, you know, political circumstances. It is, you know, something to navigate, you know, and I think for us, it's been very fruitful and I've learned a lot from Hao Chen. And, but I know that there's a lot of nervousness around around this question, especially in the United States and China. Yeah, I remember that when we were sort of putting together the chapters in back in 2021, that was the year in which DD, China's, you know, you know, China's equivalent to Uber here, was about to go public in New York. And then this deal was, you know, halted by the Chinese government. And we talked about this kind of scary moment, and how we should deal with this subject matter in our book. And we're so fortunate, fortunate that we, I think we talked about this, you know, drama in our intro. And we also have contributors dealing with such an important issue as well. Yeah, that was the launch of the Chinese tech crackdown. The DD move was, you know, basically demolished a trillion dollars of market cap of Chinese tech companies, that and, and, and shortly thereafter, other moves. So very interesting to watch as China went after its own companies during that process. Thank you. That's a wonderful answer. And it also, a lot of my friends ask, say that it's hard to tell where your friendships and then where your collaborations begin. And I'm like, it's, it is hard to tell because they're all intertwined. So thank you. That was wonderful. It was nuanced. I had a China question that I'm going to hold with in case other people do. And I feel like you'll answer half of it already. So I'm going to ask you my broader question. And then after that, maybe you could have a conversation with the audience, which is that the book, I love that it discusses many kinds of sovereignty, states, territorial sovereignty, discuss companies, ideas on duty. But in my work, I've been reading a little bit and thinking a little bit about how to break outside territorial democracy and including people's voice and giving people some. Where would you say this, this idea of democracy and the people fits in this, in this sort of geopolitical discourse of titans? So let me begin. You know, I mentioned popular sovereignty earlier as kind of a through line in much of my work. By the way, this, you know, Terri and the professors will appreciate this all goes back to what I thought about what the seminars I took when I was in law school, I took a seminar with a kilomar on popular sovereignty. And so I still that that issue is at the, you know, various seminars or moments in my, in my law school education really animate my work, you know, I don't want to tell you how many decades later. But so I, you know, this is obviously a critical thing. I began in your first question by responding that this, you know, we had these new Leviathans. And this was a way to, for countries to assert themselves vis-à-vis these Leviathans. I should also note that there are also small players. So, you know, one of the worries that I have about internet regulation is that when governments regulate, they regulate based off with five companies in mind. They think it has really five companies and internet is far more complicated than that. And so I think it's important to think about smaller companies as well. But what we see, I think digital sovereignty is an expression very much of popular sovereignty in that way. And so, so I think it's necessary. And so, you know, I have, I think it's, it's, but I also, you know, in the book we say it's both necessary and dangerous. It's both critical for popular sovereignty and it's better more because it can, that kind of control, the control that you can get through territorial control and digital control is a combination that is an incredibly powerful mix. And so I think we should be very cautious about that, right? There's a kind of totalitarianism that's possible today that really, you know, would have been the hope of many totalitarianism in the past. So I think we need to be very cautious about this. In the book, we also have our concern that this is not just a warning to traditional, to governments that we traditionally view as authoritarian. So what I want to do also in the book is really kind of, you know, not just simply say there's a northern ethical tech regulation and a southern unethical tech regulation. I want to avoid that kind of framing. And so basically to say, you know, ethical and unethical tech regulation occurs in all domains. And we should be cautious about it everywhere. We should be critical about it in China and in the United States, etc. That's, I'm not trying to draw false equivalents. I think there's certainly, you know, different worries that one might have and things like that. But I think we need to be cautious about it. And let me give you a couple examples. So this last summer, there was a police killing, you know, that I don't know if he followed here in the United States, but a police killing in Paris of a 17 year old immigrant from 17 year old who was a descendant of North African immigrants. Okay, a boy. And the police said, you know, he was threatening, etc. Video then later arrived that suggested that the police did not appear to be under threat. You know, I'm not saying I know definitively what, you know, the story is, but there was serious questioning of the police account that video made possible. And in the wake of that, there was rioting and police men and women were injured in Paris, etc., in other jurisdictions. So, and the French state, you know, so you had, you know, President Macron, really kind of saying, hey, you know, it's the tech platforms that are causing the rioting. And so, you know, there was an effort to, and he named tech platforms, Snapchat, TikTok, were the one cause of the rioting. When one might have wondered whether or not there were other possible reasons for the population to express itself in this way. I'm not pro- rioting, etc., but the question here is, you know, so what happens next? So what does TikTok do? What does Snapchat do in response? Well, you got this new law coming on the books, now on the books, the Digital Services Act, which wasn't on the books then. By the way, during that, during the course of those conversations, he said, you know, we could ban these platforms, okay, floating the idea, okay. The DSA, the Digital Services Act, doesn't have a ban sanction available, but a temporary suspension sanction available. But I think that's actually even the real threat. But there are other sanctions within that system that basically allow the government to say, hey, we don't like what you're doing. And so, so what do you do with your TikTok or your Snapchat? This isn't your issue, perhaps, you know, on any particular issue. You simply steer the algorithm in a particular way so that you don't come on, you know, you don't cause any problems with the local authorities and lead to adverse consequences within the political system. So I think those things, you know, we should be watchful about that as well. We should make sure that if there are, you know, I have a paper on the DSA, which I suggest needs more. It doesn't have enough checks and balances built into it, doesn't have enough, it has a lot of powers, but not enough protections built into it. And I think we need to be thinking about these things in a variety of ways. And then let me just say this morning, the Biden administration sanctioned a group called, it's called Intellexus, sorry, I wrote it down. It's sanctioned a company called Intellexus, Intellexa Consortium, okay, which turns out because, why? Because Intellexa is selling surveillance as a service. And a lot of these companies turn out to be based in Europe, okay. This is a Greek company that's selling surveillance as a service. And so the worry is that, you know, it's selling it indiscriminately and it's being used to target dissidents in various ways across the world. And I think Western governments need to do a lot more because we properly complain about Chinese companies selling authoritarian technology in Africa and elsewhere. And I think that's exactly right. But we should also be very concerned when you can buy tools that can hack your iPhone, et cetera. And these are Western companies doing it. And European, I haven't seen the European regulators act on these questions, basically at all. And so you see, so there's a lot of European action against American companies, maybe they should also be looking within their own borders. This is exactly why I enjoyed the book and enjoy your work so much. It is a complete picture. It asks all of these questions that I'm always eager to know the answers to. So as you can imagine, I have many more questions, but I don't want to be selfish. So I'm now opening by the audience to ask questions. And if you don't have any, then I will go through them. But I cannot believe that you don't have any. Well, I might selflessly jump into the phone as well. The picture of these, these the return of the stage to wrestle these polypens, I think it's a really compelling one. And I just love to hear your thoughts that maybe about trends that have emerged over the last, since you've put the book together and started working on the book of states exerting power to create national champions in the context of cloud infrastructure or AI. So not just to assert control over these foreign digital presences, but rather to create national capacities to assert some sort of independence and to create or to prevent reliance on foreign sort of sources of those services and whatever else. So I love your thoughts about that different sort of emergence of the state in the last couple of years. So I'll begin quickly. So by the way, in my own mind, I always think of the other book that I go to is of course Gulliver's Travels with Leviathan, who is, you know, not actually that big in his own land, but when he travels to another land, quite enormous. And then it's tiny little Ephesians who try to wrestle him down to the ground. And in some sense, that is partly what's going on. But your question is with respect to the effort to create national champions. One of the striking things about the Chinese actions was how they were really focused on their own national champions. It was Tencent that got it. It was DD, which, you know, was on its way to incredible success until it suddenly wasn't, until it became, you know, desperately fighting for survival, etc. So it's just fascinating to see that I think, you know, we'd love to hear from Houchin a little bit more about why he thinks that happened with the tech crackdown in China in particular. But the desire to build an indigenous tech ecosystem is shared across the world. No one wants to be reliant entirely on U.S.-based companies or Chinese-based companies. My worry in this context is that sometimes when governments essentially act in protectionist ways, so, you know, I studied a lot of economic development, which, and the goal of economic development for many decades in the last half, in much of the 20th century, the goal was to replace foreign enterprise with domestic enterprise. And that often was a failure. And so I think it's, you know, that history should be a caution for this effort, because it turned out to raise costs for the rest of enterprise that depended upon those particular things. The United States today, if you build, so we're trying to put in, you know, huge semiconductor plants, etc. Turns out that in battery plants, when Panasonic is building these things, it needs a lot of steel. And by the way, you have to buy American steel. And that makes it very hard for Panasonic to actually build the battery plants in the United States. So, you know, we're trying to help steel workers on one side, but we're harming a huge swath of industry on the other side. So I think we should be cautious about that. And I think, so I am nervous about the national champions model of economic development. I do think everyone should figure out how can we best empower our domestic industry and have the benefit from these things. But I'm very concerned about the protectionism that is very popular. And there's an easy logic to protectionism, but that history doesn't really, history doesn't bear it out as a very successful strategy. Thank you for the question. So let me quickly talk about China, because it is absolutely a strategy that this so-called national champion strategy that China has been adopted and applied. And as Anong pointed out, these big companies such as Tencent, DD are the best examples. But I think the landscape in China is very complicated. And nowadays, it's easy to portray China as a sooner this kind of state or government oriented regulation of tech development of tech. But on the other hand, we have the United States, which will follow this market based approach. And then in the European Union, it has the rights based approach, exemplified by the GDPR. But this conventional portrayal of China might be a little bit kind of narrow-minded, I think. I would say that actually the tech development in China started from this kind of market-oriented model in the very first place. For example, the rise of Tencent, the rise of Alibaba, or began with this kind of market practice. For example, Alibaba is an e-commerce platform. E-commerce means that you buy things through platforms such as Alibaba, through voluntary transactions, market-oriented practice, contract-based transactions. And also Tencent, for example, is an example about providing, chatting apps, services, and then later on gaming and advertisement that Tencent is known for offering services like that. So the rapid growth of these tech companies shows that at the very beginning, China followed this kind of market-oriented approach, especially when China opened its door to the rest of the world and needs international investment, foreign investment. So I would say that we need to have this kind of historical review of tech development in China first. The development of tech in China following these kind of market-oriented practices, but then later on there is this kind of strange development. For example, I would say this market-oriented approach is also governed by over a sort of couple with state-oriented regulation. I think the best example is the kind of great firewall that China has exerted in the country, which means that several major tech companies such as Google or Facebook are not allowed to do business in China because of this great firewall practice. And at the same time, Chinese citizens could not have access to information that is displayed outside this great firewall. But that practice actually was very good for Chinese companies because it walled off competition from international companies such as Google and Facebook. So within China, you can see that the market-oriented arrangement at the same time, the government's intervention actually at the very beginning helped tech companies, although in many foreigners' eyes, these great firewall practices were totally an anti-market-based economy where it was or is still authoritarian. But so that's the very early stage, I would say. But then later on, you can see that Chinese government has started targeting the national champions as we pointed out earlier. So that's another shift that China has witnessed. And I would say this, we still have this kind of market-oriented practice. But at the same time, there has been more and more of state intervention not only targeting foreign tech companies but also dealing with national tech companies as well. I think there is one easy way to understand this major shift. This is because the Chinese government wanted to have one single voice within the country which will make the government better off when they operate this kind of authoritarian regime. And they realized that this kind of tech regulation is necessarily needed if they wanted to assert that power because it is the tech companies or social media platforms nowadays that deal with speech regulation and as well as the control of opinions that could be so powerful for governmental regulation. I think the Chinese government learned so much from the 2011 and the competition between I think it was 2016 presidential election, the competition between Hillary and Trump. Social media played such a major role in somehow deciding the outcome of the election. For example, the rise of the fake news, the use of social media platforms to advocate various voices. So I believe that the Chinese government learned such a big lesson from the US presidential election and they wanted to also exert tighter control of big tech as well. So there are various reasons why you can see that big shift. But then again, the rise of the tech war or trade war between China and the United States also kind of started to shape this kind of national champion strategy. And then the story again is very complicated. So you can see that things are starting from the trip war, the US ban on exporting chips to China actually sounded the awakening moment in China. People realized or the government realized they couldn't really rely upon foreign export. So this kind of fostering of national champions is absolutely important. But you know that it's so hard to make advanced chips within one country. You can see the rise of Taiwan, Taiwanese companies, the rise of Dutch companies in these games. But then there's another story I would tell is that although you can see that there is heavy regulation in big tech in China, but also when it comes to electric companies or electric car industry in China, you can see that the Chinese government has been providing so much support. For example, through state subsidy, there's a one city that you must visit, or there's one electric car company that you must pay attention to. This is a city is called Shenzhen. We're on a company I visited back in 2019. And then this company, Shenzhen, this company BYD. Now the sale of BYD electric car has surpassed Tesla. And I think that profit margin that this company is also outpaced Tesla. But the growth of this company actually has, similar to a large extent, of course, is a great company, a lot of innovation. But state of support played a major role. But there's one interesting story I want to share. If you go to Shenzhen, you can see that taxis there, taxi cars there, there's only one brand, BYD. So I'm pretty sure that there was this kind of citywide plan to purchase BYDs electric cars. In the name of environmental protection, in the name of promoting electric car industry in Shenzhen. So this kind of state support is obvious and widespread. But then when I was visiting Munich for the very first time, I saw that, oh my god, for the very first time, there is this one city with one single brand for taxi cars. Mercedes-Benz, I was shocked. This is luxurious car brand. But how come it was service? Taxi cars, excuse me, taxi cars use one single brand, Mercedes-Benz. But later on, I realized it must have been achieved through market-based arrangement. But back in Shenzhen, you can see that there was very firm and strong state support fostering and promoting electric car industry in China. So I would say this kind of national champion strategy is very complicated in China. Market-oriented practice of state support, state regulation. I want to come to various national interests. I think for the time being, the most important thing is this kind of national interest or how we can make this authoritarian regime sustainable. So regulation of social media platform, at the same time, promotion of electric car industry. I think the picture there is so interesting. Questions in the room? Hi, thank you so much for being here and for the talk. Can I ask you to just identify yourself? Yeah, my name is Yavanna. I'm an LLM student at the Law School. And I'm curious to ask if you could like share a little bit more about the choices about straight regulation and legalization as the two last parts of the book. If this was a solution to making a more interoperable and like divided power and kind of like try to break the super nations or if this was just a way of showing what is currently happening and the promises and challenges of these both kind of like solutions now. So let me try to answer that. So the book has a variety of views on the question of data localization. And so you've got Graham Greenleaf who is probably a little bit more sympathetic to data localization. You've got KS Park, Kempston Park. So Graham is a professor at Australia and Kempston is a professor at Pre-University Law School. And you've got others, Neha Mishra and Gwajna student Geneva. And you've got Doug Arner writing a legalization one of Pagin's colleagues at University of Hong Kong. So there are variety of views in the book. I'll just say my views on this question because it's a copy of terrain. I'm seeing data localization as really the 21st century industrial policy which is build your factories here. We will stop the unfortunate coming in. India did this for much of its early, for its first 50 years of development. And as I tried to hint at before, as I said before, I haven't seen that as a very successful strategy historically. And maybe there's something different today about data localization as opposed to Nick kicking out foreign companies. The digital space may be different than kicking them out in the industrial space. And I think those are important questions to ask. I'm not convinced. So first a few quick points here. Data localization means put this huge facility on the ground somewhere in your country. If you've ever visited one of these data centers, how many people do you meet? It's a handful of people. And what is the investment? It's not in the people. It's in the computers, the computer servers, the land, and the energy. And it could be water supplies as well. And so those are the things you need. So energy and water tend to be very precious and rare commodities, especially in the development world. And so you're putting more strain on local energy grid. It might not be as green as alternatives. So there's a climate change, there's a huge climate change aspect of all this, which is what you'd like to do is put your cloud wherever it's the greenest. So that would be ideal. Data localization doesn't care if it's green. Data localization says build it here. And so when people say, oh, this is a billion dollar cloud center, most of that money is in the investment of the computers that go in there, which are imported from somewhere else. So it's also part of the, you know, what is that billion dollars? Is that billion dollars going into the domestic economy? Typically not. It's a huge kind of draw of energy and water in the local domain. So is that helping people? And then who's benefiting? Okay. Does the fact that your cloud sits here, as opposed to there, then create a local, you know, software industry based on the local cloud. It's not so clear, right? And so what you're doing is you potentially raising the costs for your local software industry to access the cloud. So in many jurisdictions like in Brazil, you know, Brazil thought about this, they looked and said, look, actually domestic cloud is much more expensive. And you've got a lot of companies saying, hey, you're forced us to only source from the domestic cloud providers or force the foreigners to go domestic, you're actually reducing our, you know, you're making things much more difficult for us. So then finally, cybersecurity, you know, by kicking out lots of companies by reducing competition, I think you ultimately harm cybersecurity. So I think in a variety of measures, digitalization is not a great policy. I've actually described in a new paper working on that digitalization is going to be much worse, because now it's not only kicking out. It's basically saying you not only have to localize here, you have to localize here on local companies. So you can't be able to ask to build a cloud locally. Yeah, you can't just, you can't be a US at all. It can't be Microsoft, can't be Apple, can't be Google or Oracle. And that I think is even more costly. My name is Pengfei, I'm a visiting scholar for Harvard Law School, for the law. So I have a question for Professor Shen. So I agree with you say that because China has built a war, therefore foreign company cannot re-enter. And then China's domestic internet companies scale up. But I think that there is an exception. Amazon did arrive in China at a very early stage and was allowed to buy the domestic economy. And in that scenario, there was no war, you know, pie. But then you'll find that Amazon does not re-survive as a giant in China. Then someone said it has to do the fact that the Chinese industry and the internet industry probably developed with its own Chinese characteristics. I just want to note your perspective on this regard. Also related on probably a little bit tougher. So since China and the United States are now competing with each other in the AI sector, which is kind of a next chapter of digital sovereignty, I would say. So in this regard, I just want to hear your comments. Who will find and when from your prediction? Thank you. Thank you so much. These are great questions and these are really, really great questions. So let me try to respond to the first question. So let me quickly ask an audience here. How many of you know KendoDuo, another e-commerce company and its application here called Temu? Okay, great. So I think there is a story behind the competition between Amazon and a variety of e-commerce platforms in China. As you rightly pointed out, China allowed Amazon to do business in China. So I think e-commerce was fine at the time. But if you want to say both things, it was not okay in China. But sustaining money is fine with Chinese government. But if you were speaking something loud in the social media platform, for example, through Google or Facebook, it was not allowed. So that was the difference. So money was not an issue. We welcome money. So that's the thing and why Amazon was permitted to do business in China. Although I'm not sure whether CEO Amazon had any special relationship with any top leaders in China. Maybe he speaks Chinese or he's good at cooking Chinese food. I don't know about that. But you can see that this kind of nature of the business Amazon has carried out in China. But unfortunately, this great American company Amazon has done such a great job in this country and many countries around the world. But surprisingly, I think Amazon, as you rightly pointed out, Amazon could not really compete well with many other e-commerce platforms in China, such as Alibaba, Taobao, T-Mall, Pingguo Luo, and also Jingdong, another major e-commerce platform. I think culture is a big thing. And also the kinds of services and goods that they could provide is also another story. These are the major reasons I think Chinese platforms have won in the competition. First of all, Chinese platforms know local culture very well. They know customs preferences, what they exactly needed. And also the kind of services and goods that provide is also another cutting edge that Chinese companies had when they were competing with Amazon, because they know how to source the most affordable products, the products that they Chinese customers need. For example, they launched this kind of November 11th shopping festival. They just exactly know how this kind of singles day has animated people's interest in spending, of course, by offering really, really big discounts. But at the same time, you know what singles day is, right? Singles day is when you spend money on yourself. Taking care of yourself. So which is a great idea, right? And it's 1111, right? November, November, exactly. I mean, like, utterly brilliant. It could have done anywhere in the world, right? It's a brilliant Chinese e-commerce platform, creates this for and creates the, you know, phenomenal shopping day for the country. So as Anupang Adler pointed out, so if you want to do well, I mean the best, if you want to do business well in China, you not only need to know local culture very well, but also, you know, you have to sort of, you know, fund the best of, you know, business practices, right, at the same time. As to the AI question, again, this is such a big question. And I think this is the, ultimately, the most important question these days. Unfortunately, we actually have multiple chapters in the book talking about this, you know, AI thing. And for example, Andrew Woods has a chapter dealing with the rise of AI and how, especially data training process, how various countries deal with data training for the development of AI technology. So if you're interested, you can read that chapter. I strongly recommend it. But as to the AI rivalry between United States and China, as far as I know, you can see that there are two critical things that this wall will turn out to be. One is, I would say hardware, as you pointed out earlier, computers and all kinds of things. So now, computers and what, you know, one thing, but the trips, you know, are the really important matters as well. So, but then you can see that when it comes to AI, who controls trips, it is this country and also Taiwan. Okay, so now, for example, Naveedia's, you know, GPU is really dominating this, you know, landscape. So then there comes this kind of export ban imposed by the Biden administration, as you know. So the hardware side, I think China is not doing well. It cannot, you know, produce trips that are equivalent to Naveedia's GPU. When it comes to data, as I said, data is another critical thing to deal with the AI development. Here in this country, I think there is not strong regulation when it comes to collection and usage of data. So that's why AI companies can scrap so much information from the internet, ways that you don't really know. Okay, but in China, to a certain extent, you know, collection and usage of data is not that much regulated, but then you can see that the state actually heavily regulated the way that people can speak and the way that tech companies can collect and use data as well. And when it comes to data localization, I think this is one of the best examples. Chinese companies have such strict rules dealing with data localization. And also, I think diversity of data is very important. The amount of data you have is one thing, but the diversity of data is another thing. And we need to have, you know, various kinds of data can train AI models well. But then I can see that Chinese company lacks this kind of diversity because of one of the reasons is exactly about the great wall that China has built upon. So they Chinese tech companies may have difficulty in, you know, accessing and utilizing foreign data. And, you know, as I mentioned, various reasons for making data diverse. So I can see that China is not doing well in competing with the United States in this kind of grand AI wall for these kinds of major, two major reasons. But I cannot predict who will win because so far you can see that who is winning, but we don't know what will happen in China in the future. So I will say, now we have these two major players indeed in the AI sector. Unfortunately, we don't have any big tech company in the European Union. Sadly, there are no big players in Japan as well. So I hope the two big giants will compete ethically and peacefully. We don't need to see another third world war because of the AI rivalry. We're a little past time. I don't know if you have any final remarks or questions you wanted to end with. I could carry on all day, but I will not do that to you because I know your place is today. I mean, you know, this has been a wonderful way to scan the surface of people. I hope that all of you got an idea of why I think it's a wonderful and that you will take that lead. And I hope we will say that we will run into these two brilliant authors again, as I fortunately will for sure this year. I know where I'm going to see both of them so that you can continue the conversation. But it honestly is such a rich book and it asks and answers questions that I think are so under discussed. So thank you both for writing the book, but also for giving me the privilege of having this conversation with you. Thank you, Shinmai. I'm going to quickly end with two quick comments. One, I wanted to commend a particular paper in the book by Liz Lu and Barry Weingast. It's on Taobao. And basically, it says Taobao created its own legal system. And that was one of the reasons it succeeded in China. And so it's a brilliant retelling of why one particular platform beat out Amazon. And so just a fascinating point. So second, I'll make three quick ones. Teimu, which Haochun mentioned, has now come under national security scrutiny in the United States. Okay. So this e-commerce app selling household goods is being reviewed for national security concerns. And this is in the last couple of years, there is some of this in the book already, the national security deterrent in all of this. Digital sovereignty is more and more about national sovereignty. Finally, on the AI and a question that you asked and digital sovereignty, Haochun hinted at the concern that the generative AI would say unconfined things about the Chinese government. Well, this is a concern that's not only shared by, you know, clearly authoritarian governments. This is a concern shared by governments across the world and politicians across the world certainly. So you saw yesterday an announcement in India of a kind of rule that said, if you have untested models, AI models, they have to be approved by the government before they're released. Well, this kind of coincided with news reports a couple of weeks ago that that someone had asked, I think it's Gemini, Google's Gemini, is Modi fascist. Okay. And it had given a possible plausible answer saying, you know, there are some aspects of this, etc. You know how you can imagine the voice of the chatbot in this. And so the coincidence between this is not, I think, pure coincidence. Just again tell you, you know, this is these are concerns that we have across the world in every jurisdiction. I know that Modi tends, you know, we can, whether or not he's democratic or not is an open question, etc. He's certainly very popular thus far. But so it's, so these are really difficult issues across the world. All right. Well, I hope you guys will join me in thanking our guests today. And we have a bunch of speaker series events and workshops happening over the next couple weeks. So we hope to see you guys either in person or join virtually. But thanks everyone and have a wonderful day.