CHINA’S largest overseas- listed online brokers said they are in compliance with a tightening of data privacy rules, seeking to quell concerns after the People’s Daily highlighted regulatory risks as China’s new personal data privacy law takes effect Nov. 1.

In statements issued Friday, Futu Holdings Ltd. and Up Fintech Holding Ltd. said they both have proactively complied with relevant regulations.

China will implement the Personal Information Protection Law from Nov. 1, complementing the Data Security Law in regulating cyberspace and safeguarding national security.

The new rules will regulate export of personal data, posing a challenge to online brokers that provide cross-border trading services to Chinese mainland citizens, the People’s Daily said in an analysis on its website, pointing to Futu and Up Fintech as case studies.

The two firms slumped 12.4 percent and 21.2 percent, respectively, in New York trading Thursday. The article said user data of both brokers are at risk of being compromised as they are required to provide certain information to U.S. Securities and Exchange Commission.

Brokerages such as Futu and UP Fintech don’t have brokerage licenses on the Chinese mainland, but citizens on the mainland can open accounts online after submitting personal information related to ID cards, bank cards and tax records, the article said, adding: “after personal information is collected, where does it go?”

Currently, Chinese mainland investors can invest in overseas securities markets through the cross-border connect programs and through the Qualified Domestic Institutional Investors (QDII) program.

Apart from these two channels, China’s securities regulator has not allowed any institutions to provide cross-border trading services to domestic investors, the People’s Daily said.

Futu and Up Fintech have been operating in a gray area, allowing millions of Chinese mainland investors to evade capital controls to trade shares offshore in markets such as Hong Kong and New York.

Asked about whether investors can trade foreign securities on platforms including Futu and Up Fintech, the China Securities Regulatory Commission said in 2016 that it has not given permission to any domestic or international institutions to provide such trading services to domestic investors. (SD-Agencies)