Source: Hindustan Times    Published: 2021-07-05

China’s cyberspace regulator has ordered the removal of the country’s largest ride-hailing app Didi Chuxing from mobile app stores following allegations of “serious violations of law and regulations” in collecting and using personal information.

The crackdown comes days after the leading Chinese ride-hailing platform – and arguably the second in the world after Uber -- made its Wall Street debut on Wednesday, pegging the company’s value at more than $69 billion at the end of the launch day.

Didi’s app was still working in China on Monday for users who had already downloaded it. It offers over 20 million rides in China every day.

“Investigations concluded the app severely violated relevant laws and regulations while collecting and abusing user data,” the administration was quoted as saying by the news agency Xinhua.

“The administration urged the ride-hailing company to take concrete measures to fix the loopholes in accordance with the law and national standards to ensure the safety of user information,” the Xinhua report said.

Chinese state media reported that the latest order further underscored “Chinese regulators’ resolve to crack down on illegal activities on online platforms and enhance the protection of data security”.

A widespread regulatory squeeze on domestic tech firms, focusing on anti-competitive behaviour and data security began with the scuttling of a $37 billion listing planned by Alibaba affiliate Ant Group late last year.

“The company expects that the app’s takedown may have an adverse impact on its revenue in China,” Didi said in a statement.

Reckoning the review as a timely move to institute a firewall to ensure data security, which is of significance to national security, Dong Shaopeng from Chongyang Institute for Financial Studies at Renmin University of China called for delisting of Didi’s newly floated shares.

“Ride-hailing firms manage large amounts of data regarding national transport infrastructure, flows of people and vehicles, among other types of information that involve national security,” Dong told the tabloid Global Times.

The rise of “data sovereignty” versus the US government’s vigilance against Chinese firms ought to be a wake-up call for national security awareness to be given priority when it comes to fundraising plans in areas that might pose threats to China’s national security, Dong said.

Didi’s global annual active users for the one-year period ending March 31 stood at 493 million, according to the company.

Founded in 2012, the company offers a range of app-based services across Asia Pacific, Latin America and Africa, as well as in Central Asia and Russia, including ride-hailing, taxi-hailing, chauffeur services, hitching services and other forms of shared transport.

Please Find us: Twitter: RDCYINST    YouTube: RealRDCY      LinkedIn: 人大重阳RDCY    Facebook: RDCYINST    Instagram: rdcyinst