(By You Yunting) According to a recent report by China Newsweek, ZCode, an AI coding tool developed by Zhipu AI, a publicly listed company, has been found to secretly package, encrypt, and upload to the cloud, by default, the entire workspace data of logged-in users. On September 18, Zhipu issued an apology in its official user community. A source interviewed by the report, however, said the data was in fact uploaded to an Alibaba Cloud OSS bucket in Hong Kong[i]. In my view, this incident may involve large-scale outbound transfer of data, and the possibility that it includes “important data” cannot be ruled out. Regulators therefore have cause to investigate, and Zhipu is also under a legal duty to notify users and to report to the competent authorities.