China’s internet watchdog has launched an investigation into Didi Chuxing, the country’s largest ride-hailing company, for data security violations.
This development occurred just two days after the company’s initial public offering (IPO) on the New York Stock Exchange (NYSE), according to NHK World. According to the NYSE, Didi’s initial public offering was the second largest of the year. As of now, the Chinese regulator has suspended the application’s ability to accept new users while the investigation is ongoing.
According to experts, the review is another example of Beijing’s crackdown on influential technology companies. Earlier this month, the Chinese government levied a massive fine against Alibaba Group, the country’s largest e-commerce company.
Beijing has stepped up efforts to clean up the country’s fast-growing and free-wheeling technology sector, claiming a crackdown on anti-competitive practises by Chinese internet giants.
Each week, Chinese regulators have targeted technology companies for alleged violations ranging from inconsistent pricing to user privacy concerns to difficult working conditions, according to The Wall Street Journal (WSJ).
Beijing has a reputation for enforcing antimonopoly laws in order to limit foreign firms’ market influence. In April, regulators slapped Alibaba with a hefty USD 2.8 billion fine, alleging that the company abused its dominant market position by engaging in a contentious practise.
Chinese regulators have also enlisted the assistance of the country’s citizens in monitoring the behaviour of technology companies. Companies in the technology sector have responded with pledges to be good corporate citizens.
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