14 DAY TRIAL // The Cyberspace Administration banned Didi on Sunday, because it presented cybersecurity concerns. The regulator justified the decision by stating that Didi Chuxing apps were found to have breached user privacy regulations, according to CNN.
The company stated, "We sincerely thank the ... department for its instruction in troubleshooting Didi's risks," adding that users' privacy will be protected "We will rectify and improve risk avoidance and ... provide safe and convenient services to our users."
Three months ago, Chinese President Xi Jinping advocated for online platform restrictions. Not only does he support the investigation, but he also calls for stringent follow-up inspections of digital firms to accomplish this objective. In the recent months, many IT giants have been investigated for market monopoly or consumer rights breaches, leading to massive penalties and significant restructuring.
China's President wants to ensure that internet companies protect the privacy of their consumers
It is not the first time when a Chinese giant is forced to shut down and change the business model. At the beginning of the year, Alibaba was found guilty of monopoly and was fined $2.8 billion, the biggest ever fine in the history of the world. Following the fine, Jack Ma's business empire, Ant Group, was obliged to undergo significant operational reorganization and create a holding company under the jurisdiction of the country's central bank.
As a consequence of the state administration's campaign against anti-competitive behavior, 34 companies were issued a warning to stop any anti-competitive behavior and perform an internal investigation. Didi was called, along with the other companies, to attend the meeting.
Chinese authorities also said on Monday that they are investigating two online recruiting services, including Zhipin.com, as well as truck-hailing apps Huochebang and Yunmanman, for alleged security breaches, as part of an ongoing crackdown on digital businesses in the country.