Investing.com – Shares of Futu Holdings (NASDAQ:) and Up Fintech (NASDAQ:) plunged Thursday on a Reuters report that the U.S.-listed Chinese online brokerages face regulatory risks in their home as the country’s new personal data privacy law takes effect next month.

Futu declined 15% while Up Fintech dropped 23% to Nasdaq.

An analysis of People’s Daily’s website revealed that they may have violated data privacy regulations and could also pose compliance risks.

Futu Fintech and UP Fintech do not have any brokerage licenses in China, but they allow mainland Chinese citizens to invest on overseas stock markets like the U.S. or Europe. After submitting their personal data, such as tax records and ID cards or bank cards, citizens can open online accounts. The People’s Daily piece wondered where the data goes once it’s collected.

The world’s second largest economy will implement the Personal Information Protection Law from November 1, complementing the Data Security Law, in regulating cyberspace and safeguarding national security, Reuters said.

The Chinese authorities took a number of measures over the past few months in order to tighten compliance with online brokers and improve oversight of data usage. A wider policy shift has been made towards a more equitable distribution and better welfare.

The steps included reducing commission charges by online food delivery services and cabaggregators, providing more rest to cab drivers and controlling the amount of time children spend playing online casino games.