China’s cyberspace regulator fined Didi Global just over 8 billion yuan ($1.2 billion) on Thursday after the company found it breached cyber and data security laws, putting an end to a year-long investigation into the hitchhiking giant.
The Cyberspace Administration of China (CAC) said in a statement that the company had violated the country’s cybersecurity law, data security law and personal information protection law.
“The facts of violations of laws and regulations are clear, the evidence is conclusive, the circumstances are grave and the nature is vile,” the CAC said in a statement.
In addition to the $1.2 billion fine, the regulator also imposed a personal fine of 1 million yuan ($147,000) on Didi CEO Cheng Wei and President Liu Qing, respectively. Liu Qing is also known as Jean Liu in English.
In a separate statement, CAC said investigators found Didi committed 16 violations of the law, including illegally obtaining some information from users’ smartphones and collecting data about facial recognition, age, jobs and family relationships.
It added that the company “avoided complying with the explicit requirements of regulatory authorities and maliciously avoided oversight,” and the company’s “illegal operations” brought “serious risks to the security of China’s information infrastructure and data security.”
The investigation
Just days after Didi’s $4.4 billion IPO on Wall Street on June 30, 2021, the regulator banned Didi from app stores in the country and launched an investigation into its handling of customer data.
Authorities accused Didi of violating privacy laws and posing cybersecurity risks. Its actions were also widely seen as punishment for the company’s decision to go public abroad rather than in China.
The regulatory actions have made the company a poster boy for Beijing’s crackdown on tech companies and wiped out tens of billions of dollars from its market capitalization.
It also hit Didi’s domestic business. The company posted a loss of $4.7 billion in the third quarter of 2021. Its revenue was down 1.7% year-on-year.
Under pressure from Chinese regulators, Didi announced in December that it would begin delisting from the NYSE and move to Hong Kong. In May, shareholders voted to authorize the company’s delisting from the New York Stock Exchange.
Shortly after the regulator’s announcements, Didi Global responded in a statement on Thursday that it “sincerely” accepts the imposition of administrative penalties by the regulator.
“We sincerely accept this decision and we resolutely obey it. We will strictly follow the penalty decision and the requirements of the relevant laws and regulations, carry out a comprehensive and in-depth self-examination, and actively cooperate with the supervision and thorough rectification carefully,” he said.
“We will take this as a warning and further strengthen the construction of cyberspace security and data security, strengthen the protection of personal information and fulfill our social responsibilities, striving for the healthy and sustainable development of the company,” he added.
Source: CNN Brasil
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