The influence of cybersecurity law leading to google’s challenges in russia

The article considers and evaluates the significance of cybersecurity for the growth of the digital technology industry, taking the case of the enormous Google which encountered challenges when entering and expanding in the Russian market. The article gives an overview of the legal system in Russia and the US, pointing out the obvious differences of the two systems leading to other professions, especially the cybersecurity law. The cybersecurity law plays an extremely important role in the modern world, especially in the era when the 4.0 revolution is developing more and more globally. Seizing the times, the Russian Government has strictly tightened the law on this profession. According to the reports findings, the cybersecurity challenge that the Russian government poses to Google is a worthy threat for other technological companies to consider looking at new directions to this market. Through it, we also point out a few suggestions after Googles failure. The article used a qualitative methodology, by collecting information sources through websites, journals, news and related articles.

FOREIGN TRADE UNIVERSITY SCHOOLS OF ECONOMICS AND INTERNATIONAL BUSINESS INTERNATIONAL BUSINESS REPORT TOPIC: THE INFLUENCE OF CYBERSECURITY LAW LEADING TO GOOGLE’S CHALLENGES IN RUSSIA Group: Class: KDOE307 Lecturer: Ph.D Nguyen Hong Hanh Hanoi, May 2023 TABLE OF CONTENT CHAPTER 1: THE OVERVIEW OF GOOGLE General introduction 1.1 History of formation and development 1.2 Vision and mission Google in Russia CHAPTER 2: ANALYSIS OF THE INFLUENCE OF CYBERSECURITY LAW ENVIRONMENT ON GOOGLE’S OPERATION IN RUSSIA 10 The overview of legal system in Russia and the US .10 1.1 Overview of the legal systems in Russia .10 1.2 Overview of the legal systems in the US .10 1.3 Differences between the legal system in Russia and the US 11 The impact of cybersecurity law on Google’s challenges in Russia 13 2.1 Internet censorship 14 2.2 Data localization 17 2.3 Sovereign internet law 18 CHAPTER 3: GOOGLE’S ADAPTATION AND LESSONS LEARNED 21 Google’s adaptation 21 What can we learn from the “Google in Russia" case? .22 CONCLUSION 24 REFERENCES 25 ABSTRACT The article considers and evaluates the significance of cybersecurity for the growth of the digital technology industry, taking the case of the enormous Google which encountered challenges when entering and expanding in the Russian market The article gives an overview of the legal system in Russia and the US, pointing out the obvious differences of the two systems leading to other professions, especially the cybersecurity law The cybersecurity law plays an extremely important role in the modern world, especially in the era when the 4.0 revolution is developing more and more globally Seizing the times, the Russian Government has strictly tightened the law on this profession According to the report's findings, the cybersecurity challenge that the Russian government poses to Google is a worthy threat for other technological companies to consider looking at new directions to this market Through it, we also point out a few suggestions after Google's failure The article used a qualitative methodology, by collecting information sources through websites, journals, news and related articles Key words: Google, cyber security laws, Russia market, difference, challenges INTRODUCTION Technology is gradually becoming an inevitable part of our lives It has a significant influence on all facets of life, including business, production, and entertainment and culture People can now complete tasks more quickly, correctly, and effectively thanks to technology It provides us with utilities and solutions to solve complex problems and improve the quality of life In the future, technology will continue to evolve and lead us to its promising potential, but we also need to be cautious and aware of its impacts on our lives Therefore, the security of technology is also increasingly concerned One of the most advanced and secure technology sectors today is cybersecurity This sector of technology is undergoing exceptional growth with great competence and complete security In order to maximize the aforementioned, there must be both binding laws and government control Cybersecurity law is a set of laws and regulations set forth to safeguard the internet and the data sent over it The goal of cybersecurity law is to protect sensitive documents and personal information, prevent cyberattacks, and mitigate the impact of cybersecurity breaches Protection of copyright, prevention of counterfeiting and other types of cybercrime, assurance of the security of online transactions, and eradication of all forms of infringement are all covered by regulations relating to cybersecurity online privacy through data collection and forms of monitoring users' private lives Many countries have enacted specific regulations and laws on cybersecurity, such as the Budapest Convention on Computer Crime, the Law on Cybersecurity Protection in China, or the European Union regulations on online privacy (GDPR) It can be exceedingly difficult and lucrative for major businesses to enter a new market This is an opportunity to open a new chapter for enterprises in general while promoting cultural diversity, education, and exploration for various nations The technology sector has always been a pioneer and major consideration for a country Google in Russia, on the other hand, was successful in the new market, but it struggled to keep it and encountered many obstacles The fact that when penetrating the Russian market, Google has to compete with domestic technology companies and have difficulty operating in this country However, the main challenges come from the difference in cybersecurity laws of Russia that are sometimes inconsistent with Google's policies and systems Realizing the significance of cybersecurity law when it comes to technology companies penetrating the Russian market, our team has decided to choose the topic: “The influence of cybersecurity law leading to Google’s challenges in Russia” The report focuses on three chapters, including: Chapter 1: The overview of Google Chapter 2: Analysis of the influence of cybersecurity law environment on Google’s operation in Russia Chapter 3: Google’s adaptation and lessons learned CHAPTER 1: THE OVERVIEW OF GOOGLE General introduction 1.1 History of formation and development ● Overview of Google People no longer find Google to be unusual; practically every time they need to look for something, they immediately think of Google In fact, Google LLC (Limited Liability Company) is an American multinational technology business with a focus on online advertising, search engine technology, cloud computing, computer software, quantum computing, e-commerce, artificial intelligence, and consumer electronics Due to its market dominance, data collection, and technological advantages in the field of artificial intelligence, it has been called "the most powerful company in the world" and one of the most valuable brands in the world Along with Microsoft, Amazon, Apple, Meta, and Apple, its parent firm Alphabet is regarded as one of the Big Five American technological corporations ● Developments of Google Larry Page and Sergey Brin founded the Google Company while doing their Ph D at Stanford University The company was established by its two founders as a private business in 1998, and after that, in 2004, they received their first public offering When Google reached its full potential in 2006, its creators moved the company's headquarters to Mountain View, California Since that time, Google has grown rapidly Of all the search engines, Google has the biggest market share.Google underwent a reorganization in 2015 and became an Alphabet Inc wholly owned subsidiary Google, Alphabet's largest business, serves as a holding corporation for all of Alphabet's online assets Google’s search engine has gained fame, and is used globally Google also offers a social networking site called Google+ Gmail is one of the best and most efficient productivity software offered by Google and its usage expands on a daily process globally Google has the largest market share in internet usage, social networking and cloud computing An approximate of 80% of businesses uses Google products and services globally Since then, the business has expanded quickly to provide a wide range of services and products in addition to Google Search, many of which command significant market share Several different use cases are addressed by these products, such as email (Gmail), navigation (Waze & Maps), cloud computing (Cloud), web browsing (Chrome), video sharing (YouTube), productivity (Workspace), operating systems (Android), cloud storage (Drive), language translation (Translate), photo storage (Photos), video calling (Meet), smart home (Nest), smartphones (Pixel), wearable technology (Pixel Watch & Fitbit), music streaming ( YouTube Music), video on demand (YouTube TV), artificial intelligence (Google Assistant), machine learning APIs (TensorFlow), AI chips (TPU), and more The Google Corporation manipulates more than one million data center servers globally There is an increasing demand for the services of handling servers worldwide and Google anticipates managing over one billion data center servers in the near future As at October, 4:00pm, Google’s stock price dropped by 6.61 trading at $865.74 per share This represented a 0.8% negative change from the previous sales However, Google’s stock price heads towards trading at $1000 per share in the near future 1.2 Vision and mission To establish and keep a dominant position in a number of global industries, Google has put their mission and vision statements into practice The mission statement of the corporation encourages the business to innovate quickly and reach new heights The company's mission statement also outlines its commercial initiatives, such as the creation of new products The efforts made by Google to achieve its corporate vision and goal are closely related to the company's success The company's expansion in the computer technology (software and hardware), cloud computing, consumer electronics, and digital content distribution sectors is supported by such fulfillment  Vision Google’s corporate vision is “to provide access to the world’s information in one click.” This vision statement is directly reflected in the business model of the company For instance, Google's search engine service is the company's most wellknown offering People may readily obtain information from all around the world thanks to this device In order to continue dominating the market for Internet technology, software, hardware, and online services, the corporation uses its vision and mission statement together The main components of the company's corporate vision are as follows: World’s information Access One click Google’s corporate vision statement has three variables, namely, world’s information, accessibility, and one click The company fulfills the “world’s information” component of the vision statement by indexing web pages and maintaining databases of the resulting information Google applies the “accessibility” component by offering its products to everyone around the world The “one click” component of the corporate vision refers to easy access to information The company fulfills this component by offering innovative products, such as the easy-to-use Google Search ● Mission Google’s corporate mission is “to organize the world’s information and make it universally accessible and useful.” Since its inception, the business has concentrated on creating its own unique algorithms to organize web data as efficiently as possible Google is still committed to making sure that individuals have access to the information they require The mission statement of the organization corresponds to a utilitarian advantage that the company offers to its customers These are the main components of Google's corporate mission in this regard: World’s information Organization Universal accessibility Usefulness The company fulfills the “world’s information” component by crawling websites The company organizes the information through its proprietary computer algorithms Google also fulfills the “universal accessibility” component of its corporate mission by offering its products worldwide Google in Russia With such success, market expansion is what any multinational company aims for So does Google After having a certain influence in the American market, in 2006 Google entered the Russian market - a market with a fledgling technology platform Google joined the company in Russia and immediately became the country's leading technology company They provide many services and products to users here, including search engines, Gmail, Google Maps, and many other apps With a market share in Russia of more than 30%, Google has become the dominant player in the search and digital marketing market Google's initial success in Russia is based on the company's outstanding advantages in technology as well as its global experience Google has invested millions of dollars in a number of special areas in Russia, including setting up local offices and compensating advertising campaigns In addition, Google is promoting the development of Russian-language products and services as well as providing support for domestic application developers It didn't last long, Google fell into a difficult period around 2012 - 2018:  2012: Major tech companies including Google were banned from operating in Russia due to suspicions that they were helping NGOs and the Russian people during the Russian Revolution ● 2014: The Russian government banned the use of Google services such as Gmail, Youtube and Google Search due to pressure from domestic technology enterprises (Yandex) ● In 2018, Google continued to fail when it could not apply a change strategy because it did not meet the requirements of security and privacy standards issued by the Russian government Therefore, Google's activities are significantly limited and they tend to withdraw from Russia Currently, Google has only one company branch in Moscow and constantly encounters obstruction and fines related to legal issues Typical through some events: ● On July 29, 7,2021, the Tagansky district court in Moscow, Russia, said that the country had fined the US technology company Google million rubles ($41,017) for violating the law on personal data This is the first time Google has been fined for this crime ● On July 18, 2022 - Google was fined 21.1 billion rubles ($373 million) by a Moscow court on Monday for repeatedly failing to remove content that Russia considers illegal, such as "fake news" about the conflict in Ukraine, Russia's media regulator said ● On May 11, 2023- A Russian court fined Google million rubles ($38,600) on Thursday for failing to remove YouTube videos it said promoted "LGBT propaganda" and "misinformation" " about Russia's military operation in Ukraine, Russian news agencies reported So far, Google appears to be the first major tech company to file for bankruptcy in Russia as a result of the Ukraine war Other companies such as Apple, Meta, and Microsoft have all suspended operations in the country, but none of their branches in Russia have declared bankruptcy 10 CHAPTER 2: ANALYSIS OF THE INFLUENCE OF CYBERSECURITY LAW ENVIRONMENT ON GOOGLE’S OPERATION IN RUSSIA The overview of legal system in Russia and the US 1.1 Overview of the legal systems in Russia The Russian Federation has a civil law system Russian law includes both codified laws (for example, the Civil Code and the Criminal Code) and other laws which, as a general rule, must be consistent with the relevant codes Legislation has supreme juridical force (compared with bylaws and other sources of law) However, the Constitutional Court can invalidate laws that are unconstitutional International law is also recognised as part of the Russian legal system In Russia, the main sources of law include the Constitution, federal constitutional laws, federal laws, decrees of the President, resolutions of the Government, and legal acts of authorized state bodies Case law is recognised as a de facto source of law This means that judgments by the Constitutional Court that contain interpretations of the law bind all courts, state agencies, legal entities and individuals Supreme Court judgments are also binding on the lower courts to ensure uniformity of legal practice The Russian court structure consists of the Constitutional Court along with the federal courts and the regional courts, both headed by the Supreme Court Federal courts include commercial courts that resolve economic disputes and courts of general jurisdiction handling all other cases Regional courts include magistrates’ courts resolving minor matters, and the constitutional (statutory) courts of the Russian regions, which handle cases concerning the regions’ constitutions (statutes) The Constitutional Court deals with disputes concerning the constitutionality of certain legal acts and is a separate judicial body in the Russian court system The Supreme Court is the court of cassation (second-tier) and the supervisory court handling cases on challenge of judicial acts of the Supreme Court and holding a final decision for both courts of general jurisdiction and commercial courts 1.2 Overview of the legal systems in the US The American legal system is a common law system, which mainly depends on court precedent in formal adjudications In the common law system, judicial rulings in preceding court cases are crucial to the court’s decision-making process, even when a statute is in question To be more specific, common law follows the principle of stare decisis (in Latin meaning “stand by your decision”) Stare decisis is a legal principle 13 courts + Constitutional (statutory) courts In conclusion, the Russian and American legal systems have various fundamental differences in terms of their nature, principles, sources of law and court system This reflects the difference in the approach, deployment direction and resolution of legal issues between the two countries While the Russian legal system focuses more on the executive power of the government to ensure uniformity of legal practice, the American legal system focuses on protecting freedom and justice as well as makes decisions based on the principle of separation of powers between the federal and state Therefore, understanding the differences between the two legal systems of Russia and the US will help us have a more objective view when assessing and comparing legal issues in these two countries The impact of cybersecurity law on Google’s challenges in Russia Unlike the EU, where cybersecurity is a common term, Russia tends not to use this idiom in its official legal documents The difference lies not so much in the area of terminology as in the underlying concept Under cybersecurity, the EU understands various activities necessary to protect network and information systems, the users of such systems, and other persons affected by cyber threats, while in Russia cybersecurity is an integral part of the information security concept Information security is quite broadly defined and understood as protection of an individual, society and/or the state against internal and external information threats, thereby maintaining the constitutional rights and freedoms, and quality and standard of living of citizens, as well as the sovereignty, territorial integrity and sustainable socio-economic development of the Russian Federation, and the defense and security of the state Therefore, in Russia cybersecurity is understood as one of the elements of information security, i.e., cybersecurity requirements are implemented in the context of the information security policy This difference is critical to understanding the Russian approach to cybersecurity matters: information security in Russia is governed and regulated by the state to a big extent in the interests of the state, which makes this area quite politically influenced It is aimed at establishing independence from international cyberspace, Russia’s sovereignty in the information field, and the development of domestic IT infrastructure 2.1 Internet censorship ● Overview 14 Online censorship is a novel phenomenon in Russia Especially following Moscow’s 2014 annexation of Crimea, the Kremlin has endeavored to reverse that trend Several legislative acts and amendments governing the censorship of online content have been passed, which aim to regulate information flow, combat illegal activities, and maintain social and political control Website Blocking: The Russian government has the authority to block access to websites and online content deemed illegal or containing prohibited information This includes websites with extremist content, child pornography, drug-related information, and materials violating Russian law The authorities maintain a blacklist, and ISPs are required to block access to the listed websites Content Removal: Online platforms and service providers operating in Russia are obligated to remove or restrict access to specific content upon government request This includes content that is considered extremist, harmful to children, or violating other laws Failure to comply can result in fines or blocking of the platform Social Media and Messaging Regulations: The Russian government has imposed regulations on social media platforms and messaging services This includes requirements to store user data on servers located within Russia, provide access to user information to security agencies, and comply with requests to remove certain content Non-compliance can lead to fines or potential blocking of the platform Surveillance and Monitoring: The Russian government has extensive surveillance capabilities and can monitor internet traffic, communications, and online activities of its citizens The "Yarovaya Law" passed in 2016 grants broader surveillance powers to security agencies, including data retention requirements for telecom operators and mandatory assistance in decrypting data Regulation of Online News and Blogging: Bloggers with a significant following (over 3,000 daily visitors) are required to register with the government and comply with regulations similar to those imposed on media outlets These regulations include restrictions on certain types of content and the obligation to disclose personal information "Undesirable Organizations" and Political Content: The government has the power to ban foreign organizations deemed "undesirable" or a threat to national security Internet platforms are required to block access to any resources affiliated with these organizations Additionally, online political content that is critical of the government or promotes dissent can face censorship or legal consequences Internet Shutdowns: In exceptional circumstances, such as during protests or public unrest, the government has the ability to disrupt or shut down internet access in specific regions or across the country These measures aim to control the flow of information and prevent coordination among protesters 15 As mentioned above, Internet Censorship law in Russia has been toughened A centralized internet blacklist (known as the "single register") has been maintained since 2012, allowing the government officials to control over the materials on internet platforms Meanwhile, in the US, The First Amendment of the United States Constitution protects freedom of speech and expression against federal, state, and local government censorship This means that American citizens have more freedom on online speech, and internet companies have more freedom to restrict content on their own websites Table The differences between the law of internet censorship in countries Russia The US The government censor and control The government is barred from almost every online content censoring material on the internet Illegal online content includes drug Illegal online content includes obscenity, abuse and drug production, descriptions hate speech, incitement to violence, child of suicide methods, child pornography, abuse material and revenge porn criticism of the federal government or local administrations (“extremist materials”) Government officials have control over The First Amendment of the United online materials, which means they can States Constitution protects freedom of remove any content considered “illegal” speech and expression against federal, state, and local government censorship Internet service providers must comply Internet service providers can regulate with the authorities’s regulations about the materials on their platforms materials on their platforms To sum up, internet providers in Russia have to comply with the government regulations, including removing materials that are censored according to the cybersecurity law, while those in the US not have to This contributes to the challenges that Google has to face up with when operating in the country of Russia ● Impact on Google’s operation Russia has been suing international digital businesses since 2018, particularly social media platforms, for refusing to remove content at the behest of the state media watchdog Kremlin skeptics claim the government removes content associated with the opposition, which is mostly based online, under the guise of protecting minors and combating extremism Google was one of the giant techs that suffered from the new law of internet censorship In 2018, the tech company was fined 500,000 rubles (around 6800 USD), mainly for failing to remove the content in which opposition leader Alexei Navalny called for demonstrations to be made against Russia’s president, Vladimir Putin Google then was committed to a penalty of 700,000 rubles and 1.5 million rubles in 2019 and 2020, respectively Soon after that, a Russian court found Google guilty of repeatedly failing to delete search results “containing information prohibited in Russia” and fined the company three million rubles (around 41000 USD) Continuing to refuse to remove illegal content, Google was sentenced by a Moscow court to pay 7.2 billion rubles (98 million USD) in 2021 In July 2022 it was announced that the Tagansky District Court had fined Google 21.1 billion roubles (373 million USD) for consistently failing to immediately prevent access to prohibited information It claimed that Youtube had not removed "fakes about the course of the special military operation in Ukraine, discrediting the armed forces of the Russian Federation" Additionally, it said that YouTube was allowing material that supported extremist viewpoints and encouraged young people to take part in unauthorized rallies Furthermore, Russia toughened its regulations against what it terms the "promotion of LGBT propaganda" last year in addition to implementing strict censorship measures soon after sending troops into Ukraine Any action or the dissemination of any information that is deemed to be an attempt to promote homosexuality in public, online, or in films, books, or advertisements could result in a heavy fine under the new law According to Russian authorities, Google refused to take down a number of YouTube videos, including one on the LGBT community in St Petersburg and one from a blogger considered a "foreign agent" by Moscow about how same-sex couples raise children The Russian subsidiary of Alphabet's Google filed for bankruptcy last year after authorities confiscated its bank accounts, following a December 2021 fine of 7.2 billion roubles (92.6 million USD) over what Russian authorities said was the company's "repeated failure" to delete content Anton Gorelkin, deputy head of the parliamentary committee on information policy, said that "It is not hard to predict what this attitude will lead to: Google risks losing the Russian market altogether” 2.2 Data localization ● Overview In 2014, the Russian parliament adopted amendments to the Personal Data Law (that then became known as the Data Localisation Law) that require data operators that collect Russian citizens' personal data to store and process such personal data 16 using 17 databases located in Russia The Data Localisation Law was highly criticised by business and the media but nevertheless came into force on September 2015 While this law generated a great deal of profit for Russian data centres, it also created high costs for ordinary businesses, which needed to redesign their data storage infrastructure As a second step in data protection legislation, the Russian authorities adopted the Data Localisation Law and created a new procedure restricting access to websites that violate Russian laws on personal data In particular, based on the Data Localisation Law, the DPA created a register of infringing websites The law provides for a detailed 'notice and take down' procedure Most importantly, the Data Localisation Law requires that all personal data of Russian citizens be stored and processed in Russia The location of databases with personal data of Russian citizens must be reported to the Data Protection Authority In 2019, lawmakers adopted amendments that dramatically increased the fines for non-compliance with the data localisation requirement up to 18 million roubles Meanwhile, the US currently has no limits on interstate or international transfer of data, although certain types of data may need to stay in the territory under export control laws, national security laws or sector-specific regulations Restrictions on the transfer of personal data from the US to other jurisdictions are a matter of contract for companies doing business there Table The difference between the law of data localization in the US and in Russia can be summarized in the table below: Russia The US Personal data is required to be stored and processed in Russia Only certain types of personal data is required to be stored and processed in Russia (eg: when such data is part of another type of record/dataset) Cross-border data transfer required approval from the government Cross-border data flows are not limited; transfer of personal data from the US to other jurisdictions are a matter of contract  Impact on Google’s operation While there are almost no requirements for consumer data localization in the US, the regulations in Russia are actually strict Additionally, Google is also committed to General Data Protection Regulation (GDPR) compliance The General Data Protection Regulation (GDPR) is a privacy legislation that replaced the 18 95/46/EC Directive on 19 20 Data Protection of 24 October 1995 on May 25, 2018 GDPR lays out specific requirements for businesses and organizations who are established in Europe or who serve users in Europe1 Besides, the requirement for data localization in Russia also creates high costs for businesses, as they need to redesign their data storage infrastructure Those are the reasons why Google has always been reluctant to comply with this law While most social media companies still require court orders to support government requests for user data, it is significantly easier for state authorities to gain access to data that is stored locally, either by using surveillance technology or through direct access to company servers in their jurisdiction Moscow's Tagansky district court in July 2021 found Google guilty of refusing to store personal data of Russian users on servers in Russia Google then was fined million roubles (41000 USD), a court spokeswoman told state news agency RIA Novosti This is the first time the U.S company has been penalized for breaching the controversial law passed in 2014 that requires the personal data of Russian users to be stored inside Russia One noticeable point is that Google is actually committed to complying with international law, including the General Data Protection Regulation (GDPR) The GDPR requires companies to store personal data of European Union citizens within the European Union However, when operating in Russia, the giant tech still faces a penalty for not localizing the consumers’ data in this country 2.3 Sovereign internet law ● Overview In 2019, the so-called Sovereign Internet Law aimed at the independent functioning of the Russian segment of the internet was adopted, which triggered creation of a national domain names system with top-level domain names ru, su, рф and the establishment of additional infrastructure for traffic maintenance and monitoring (including for DPI) The Federal Service for Supervision of Communications, Information Technology and Mass Media (Roskomnadzor) was provided with new powers to collect information from internet infrastructure owners, control connections to Internet Exchange Points and perform centralized management of the general communication networks, including by way of using special technical means for the prevention of threats and by giving binding instructions to communications operators and other persons in the event of a threat to the stability, security and integrity of the internet and other communications networks in Russia