China’s internet watchdog said on Friday it opened an investigation into ride-sharing company Didi Global Inc. in order to protect national security and the public interest, days after the company went public in New York. York.
HONG KONG – China’s internet watchdog said on Friday it had opened an investigation into ride-hailing company Didi Global Inc. in order to protect national security and the public interest, days after the company was surrendered public in New York.
In a statement posted on its website, the Chinese Cyberspace Administration said it would conduct a cybersecurity review in accordance with China’s cybersecurity law. While the investigation is ongoing, Didi will not accept registrations from new users.
The watchdog did not give further details on the investigation.
“DiDi will fully cooperate with the relevant government authority during the review,” the company said in a statement.
“We plan to conduct a comprehensive review of cybersecurity risks and continually improve our cybersecurity systems and technological capabilities. “
The announcement of the investigation comes two days after the company debuted on the New York Stock Exchange. Its stock price fell 6% to $ 15.31 in morning trading Friday.
The Chinese government is increasingly concerned about the influence of Chinese technology companies, as their services – such as e-commerce, payments and on-demand delivery – become ubiquitous in the lives of millions of Chinese citizens.
Authorities have launched antitrust investigations into companies like e-commerce company Alibaba and food delivery company Meituan. In April, China’s market regulator fined Alibaba a record $ 2.8 billion for violating antitrust rules.
Authorities have also fined dozens of tech companies in recent months for failing to properly disclose previous transactions and acquisitions.
Didi Global, which is backed by companies such as Softbank in Japan and Chinese tech giants Alibaba and Tencent, was originally founded in 2012 by Cheng Wei as a taxi app. It has since expanded to include other carpooling options such as private cars and bus rides.
Didi said he has lost $ 5.5 billion over the past three years, although the company has also touted its global reach and investments in developing electric and self-driving cars.