Software as a Service in China: Legal Requirements and Solutions for U.S. Software Businesses


Software as a service (“SaaS”) or cloud computing is an important software delivery model for many business applications. The software and required data are hosted centrally and accessed with a web browser over the Internet. This delivery model emerged in the U.S., led by, and has become part of the business model of all major software companies. The other software delivery model is on-premise software that is installed on a server on a business' computer network.

Cloud computing has been made possible by the wide-spread availability of greater bandwidth, particularly wireless bandwidth, more powerful processors and inexpensive network storage. In cloud computing, computing resources are made available to the user as needed rather than a business paying for and operating an under-utilized server farm loaded with expensive software.

China is a very large potential SaaS market for basic business applications such as accounting, HR and manufacturing related applications. The U.S. is the world leader in software and China is an important market with enormous potential revenue. Cloud computing will be an important part of China’s next generation information industry.

However, Since SaaS is deemed as a value-added telecommunications service in accordance with telecommunications regulations of China, for operating the business in China, an ICP license from the applicable government telecommunications authority must be obtained. This article is about the legal requirements and solutions for U.S. software businesses to operate SaaS in China.

LOADING PDF: If there are any problems, click here to download the file.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Xiao Liu | Attorney Advertising

Written by:


Xiao Liu on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:

Sign up to create your digest using LinkedIn*

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.

Already signed up? Log in here

*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.