Chinese regulators order 25 more Didi-linked apps removed from stores

An American flag is seen in front of the logo for Chinese ride hailing company Didi during the IPO on the New York Stock Exchange floor in New York City, June 30. Reuters-Yonhap

Chinese regulators blacklisted 25 more apps associated with the ride-hailing platform Didi Chuxing, Friday, the latest blow to the company as it faces a government crackdown at home and litigation overseas.

App stores in China, where 90 percent of the ride-hailing market is dominated by Didi, were ordered to remove the company’s primary app last week on “national security” grounds, just days after it went public on the New York Stock Exchange.

In a notice posted late Friday evening, the Cyberspace Administration of China (CAC) demanded that more than two dozen additional apps tied to Didi be taken down from China’s app stores, alleging the illegal collection of user data.

In similar language to its original directive, which was issued against Didi last Sunday, the CAC ordered the 25 apps to “thoroughly rectify the existing problems in strict accordance with the requirements of the law and according to national standards.”

The apps included platforms catering to enterprise clients and those moving freight, as well as apps tailored for Didi drivers, such as those used to manage dashcam footage.

The newly blacklisted apps also include Didi Shunfeng, a popular ride-pooling app that allows passengers travelling in the same direction to share a car.

Just hours after the notice, many of the apps appeared to be inaccessible on Chinese app stores.

The CAC’s notice also prohibited websites and platforms from providing links to Didi-related services.

While authorities have publicly been tight-lipped about the specific wrongdoing Didi is alleged to have committed, sources have told the South China Morning Post that regulators suspect the company’s listing was an act of deliberate deceit.

CAC officials were reported to have privately instructed Didi to postpone its New York listing, though discussions never resulted in a written record.

At $4.4 billion, Didi’s June 30 listing was the largest ever for a Chinese company in New York. In the following few days, the CAC ordered Didi to stop registering new users, then banned app stores from hosting its main app.

Didi’s mini program was also swiftly removed from the Alipay and WeChat “super apps,” the two most widely used digital platforms among China’s mobile internet users. (Alipay is operated by Alibaba, which owns SCMP.)

The crackdown, coming amid a swell in the central government’s scrutiny of big tech, sent Didi’s price plummeting, prompting anger among shareholders and concerns among US lawmakers that the company could have misled investors about its contacts with Chinese regulators.

The company now faces at least two lawsuits in the US, as well as calls from lawmakers on the Senate banking committee for an investigation by the Securities and Exchange Commission.

Didi’s predicament has fueled concerns among some investors about the vulnerability of investments in companies subject to such swift and severe actions by Beijing.

“It’s just so clear to me that people shouldn’t do business in China,” Bill Browder, a British financier and political activist, said of the predicament facing Didi and other companies that have fallen afoul of Beijing.

“People say ‘I can make so much money in China’,” said Browder, appearing in a Friday panel discussion hosted by the Washington-based Hudson Institute. “Well, you know what? You can make so much money until [authorities] decide you can’t make the money anymore and all of a sudden it’s worth zero.”

Chinese regulators order 25 more Didi-linked apps removed from stores
Source: Buhay Kapa PH