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Jan 13 (Reuters) – Chinese authorities will allow Didi Global’s ride-hailing service and other apps to return to domestic app stores as early as next week, five sources told Reuters. . Sector ends.
Didi Chuxing to resume new user registrations and downloads of 25 banned apps in China, a key step in resuming normal business since regulatory troubles began in mid-2021. was awaiting approval from the authorities of
The lifting of bans on new users and the relaunch of apps for major ride-hailing services and other businesses could come before the Chinese New Year, which begins on Jan. 22, four sources said.
The week-long holiday in China will help Didi win new customers for its business and begin work to get things back to normal, the two sources added.
The lifting of the ban on the Didi Chuxing app comes as Chinese policymakers seek to restore confidence in the private sector and look to the tech industry to spur economic activity ravaged by the COVID-19 pandemic.
Communist Party Governor Guo Shuqing of the People’s Bank of China (Central Bank) told state-run CCTV on Sunday that the central bank will step up support for private companies as part of measures to bolster the economy, while at the same time bolstering technology. He said he would ease the crackdown on businesses.
The app’s restoration also marks Didi’s completion of a year-and-a-half of regulatory-driven reforms, in which the China Cyberspace Administration (CAC), a powerful cyber watchdog, paid the company $1.2 billion in July. after imposing a fine of
Didi Chuxing already paid fines last year, but this is due to Alibaba Group (9988.HK) and Meituan (3690.HK) receiving $2.75 billion and $527 million, respectively, from antitrust regulators in 2021. It is the largest regulatory fine imposed on a Chinese tech company since the fine of Administration for market regulation, he said two of the sources.
Didi did not immediately respond to Reuters’ request for comment.
The CAC and the State Council Intelligence Service, which handles inquiries from the government’s media, did not immediately respond to Reuters’ requests for comment.
Didi’s punishment is part of Beijing’s sweeping and unprecedented crackdown on Chinese tech giants over the past two years, slashing revenues and profits as hundreds of billions of dollars have been devalued.
China’s regulator, led by the CAC, has re-launched in recent weeks to move forward with the approval process for Didi’s app to reopen, two sources and another source familiar with the matter said.
The regulator, which submitted a report on the issue to the party leader last week, is looking to formally seek his consent in the next few days, the two added.
regulatory issues
Founded in Beijing in 2012 and backed by prominent investors such as Alibaba, Tencent (0700.HK) and SoftBank Group (9984.T), Didi Chuxing is set to enter the United States in 2021, against the wishes of regulators. When I proceeded with the stock listing in , I collided with CAC. , a source previously told Reuters.
The move sparked regulatory issues for Didi, ordering 25 mobile apps to be removed from app stores, suspending new user registrations and fined for data security breaches.
Didi was also forced to end its 11-month journey as a New York Stock Exchange-traded company last June, moving from being an icon of China’s internet boom to a regulatory crackdown in Beijing. One of the biggest casualties.
The company has previously hoped a U.S. delisting and hefty fines would resolve regulatory issues, and expects to reopen the app in September after updating it to ensure compliance. rice field.
But after the Chinese Communist Party’s twice-decade congress and central leadership reshuffle in November, and Beijing abruptly lifting stringent virus restrictions late last year, many cities across the country will see COVID-19 outbreaks. Among them, Didi’s return of banned apps has been delayed.
The delay in returning the app cast a shadow over Didi’s business plans.
Reuters reported in June that Didi Chuxing and state-owned Sinomac Automobile (600335.SS) had entered into an advance deal to buy a third of their electric vehicle division in a bid to soften the impact of the pandemic on their core ride-hailing business. reportedly in talks.
The deal is largely subject to the app’s reopening for official announcements, two sources said.
Didi has also lost its edge to regulatory issues, allowing rival ride-hailing services run by automakers Geely and SAIC Motor (600104.SS) to capture market share across the country. I was hit hard by that.
Reporting by Julie Zhu, Kevin Huang, and Xu Jing. Edited by Sumeet Chatterjee and Muralikumar Anantharaman
Our standards: Thomson Reuters Trust Principles.
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