The amount of the fine represents more than 4 % of the annual turnover of the company in 2021.
Le Monde with AFP
The Chinese Internet regulator inflicted, Thursday, July 21, a fine of around 1.2 billion euros to the local leader of transport cars with driver (VTC) in China, Didi, whom he accuses in particular infringements of personal data security.
The “Chinese Uber”, a leader in car booking with a driver on the Chinese market, is under hand to take over the China in the Tech sector, started for almost two years. The Chinese Cyberespace Administration (CAC) explains in its press release that it has “undeniable evidence” that Didi has repeatedly violated Chinese law, in particular in terms of Internet security and personal data protection.
The amount of the fine, established at 8.03 billion yuan (almost 1.2 billion euros), represents more than 4 % of the annual turnover of the company in 2021. In its Communicated, the regulator criticizes, for example, to Didi for having illegally stored personal information of more than 57 million drivers in an insufficiently secure format.
The VTC company is also condemned for analyzing passenger data without their knowledge, including photos present in their mobile phones. “Despite the fact that the regulatory authorities have ordered rectifications [of Didi’s practices], no general and in -depth correction has been carried out,” deplores the Chinese administration of Cyberespace. She claims that the law offenses have spread over a period of seven years from June 2015.
Digital major companies have been, since 2020, in the viewfinder of the Chinese authorities, which have multiplied the blows against the powerful Internet groups for questions of competition and personal data. Chinese start-ups have long been encouraged to finance themselves thanks to stock exchange in the United States.
In 2014, the Alibaba online trade specialist company had thus raised Wall Street 25 billion dollars, then signing the biggest IPO of all time. But in a context of increasing confrontation with the United States, in particular in the technological field, China now encourages its nuggets to seek funding on national stock markets (Hongkong, Shanghai, Shenzhen or Beijing).
Rebounds of many of his compatriots, Didi had however maintained, in June 2021, a fundraising in New York. A obstinacy which caused the dissatisfaction of Beijing, which notably feared a transfer of sensitive data to American soil. In the process, the Chinese authorities sparked an administrative inquiry against Didi, in connection with its collection of personal data. 2>
two years of regulatory hardening
Downloading the VTC application was also prohibited – an unprecedented measure targeting a major tech group. People who already had it on their smartphone could however continue to use it. Under pressure, Didi finally announced, in December, its withdrawal from the New York Stock Exchange, after only five months rating.
This fine of the regulator announced Thursday against the VTC company is however perceived as a positive signal for companies in the Tech field, a kind of epilogue at the Tour de Vis launched in 2020. After almost two years of Regulatory hardening, Beijing had already affirmed in April its support for the digital economy, arousing the hope of reconciliation with this sector.
Several bosses have also been received by power in recent weeks, an initiative perceived as a reassuring sign addressed to powerful companies in the Internet sector.