China Releases Model Contracts to Standardize Data Trading and Transactions

On July 4, 2025, China introduced the Model Contracts for Data Trading and Circulation as a significant move to regulate the burgeoning data market and establish a standardized framework for data transactions. The initiative aligns with the national strategy to improve data circulation security governance mechanism and unlock the value of data as a key production factor, as outlined in the following documents:

Opinions of the Central Committee of the Communist Party of China and the State Council on Building Foundational Data Systems to Better Leverage the Role of Data as a Factor of Production
Implementation Plan on Improving Security Governance in Data Circulation to Further Promote the Marketization and Value Realization of Data as a Factor of Production
Government Work Report(2024)

A landmark Framework for Data Trading and Circulation

The newly released model contracts, issued by the National Data Administration （NDA） and other departments, standardize rules for data trading and circulation while preserving party autonomy, clarifying stakeholders’ rights/duties to enable lawful and productive data flows. Four key scenarios are covered as follows:

Data Provision Contracts – Governing the transfer of data rights
Data Entrusted Processing Service Contracts – Regulating entrusted data handling
Data Fusion and Development Contracts – Facilitating collaborative data innovation
Data Intermediary Service Contracts – Standardizing brokerage services in data trading and circulation

Each contract includes essential clauses on data description, quality assurance, delivery protocols, security requirements, and confidentiality, while also addressing scenario-specific concerns such as data verification, intellectual property arrangements, and profit distribution.

Key Innovations in Data Governance

1. First-ever Contract-based Data Ownership Registration

The model contracts introduce data registration clauses, allowing parties to record data rights through contractual agreements.
This mechanism aligns with China’s Tripartite Data Rights Separation Model (holding rights, usage rights, and operation rights), providing legal clarity in potential disputes.

2. Comprehensive Data Quality Assurance

For the first time, the contracts establish end-to-end quality control measures, including inspection periods, dispute resolution for substandard data, and presumed liability for unsolved defects.
Data fusion contracts explicitly require accuracy and completeness checks, ensuring reliability in collaborative projects.

3. New Model Contracts to Standardize Data Trading and Circulation Practices

Convert China’s data laws into enforceable contract terms, offering clear guidance to telecommunication and other data-heavy industries.
Set measurable data quality standards, establish ownership verification processes, and specify secure data delivery standards.
Require strict anonymization for the important data and personal information data, mandatory pre-delivery security assessments, and standardized data classification reporting.

In summary, the Model Contracts for Data Trading and Circulation provide a structured approach to data trading and circulation by clarifying rights, quality standards and compliance requirements. In this context, the risks related to data integrity, sensitive data handling, and personal information protection will be mitigated, and furthermore, more efficient and secure data transactions and the sustainable growth of China’s data marketplace will be achieved. The introduction of the model data trading contracts has established a more stable, transparent, and trustworthy legal and commercial environment, which will reduce institutional transaction costs and open broader doors to data valorization for foreign enterprises committed to long-term development in China and willing to invest in compliance building.

Chinese source of the article: https://mp.weixin.qq.com/s/miSQtTkpzrgYvrPndKtJQg