Exclusive-Didi prepares to relaunch apps in China, anticipates data probe will end soon -sources

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HONG KONG/BEIJING (Businesshala) – Didi Global is preparing to relaunch its ride-hailing and other apps in China by the end of this year, in the hope that Beijing’s cybersecurity investigation into the company is completed by then In which three people will be directly involved. Relaunch said.

FILE PHOTO: Chinese riding giant Didi’s app is seen on a mobile phone in front of the company’s logo displayed in this illustration photo taken July 1, 2021. Businesshala/Florence Low/Illustration

People who declined to be identified as the information was private, said they expected China’s cyberspace regulators to finalize any penalties on the company in December.

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A source said the company has set aside 10 billion yuan ($1.6 billion) for possible fines.

In July, China’s powerful Cyberspace Administration (CAC) ordered the App Store to remove 25 mobile apps operated by Didi – just days after the New York-listed ride-hailing giant. It also asked the company to stop registration of new users citing national security and public interest.

When asked about preparations to relaunch the apps and the amount set aside for possible fines, Didi said the information obtained by Businesshala was “in fact pure rumours without any basis” and that it was in line with the cybersecurity review. actively and fully cooperating. It did not elaborate further.

The CAC did not respond to a request for comment.

Shares of Didi, listed on the New York Stock Exchange, rose more than 3% to $9.22 in early trade on Thursday following a Businesshala report.

Didi, which has about 377 million annual active users in China, offers 25 million rides a day in the country to users who sign in to its app with a phone number and password. Its apps also offer other products such as delivery and financial services.

It ran after the CAC when it went ahead with its New York listing on June 30, even though the regulator had urged the company to withhold it while conducting a cybersecurity review of its data practices, the source said. reut.rs/3qrbUqx Told Businesshala.

Soon after, the CAC launched an investigation. reut.rs/3qwe9ZE In Didi on the collection and use of personal data. It said the data was collected illegally reut.rs/3omuQE8 and related apps including its camera device as well as distribution and financial services.

new data law

Didi responded at the time by saying that it had stopped registering new users and would make changes to comply with regulations on national security and personal data protection, and protect users’ rights.

Didi has been making changes to the apps since then to ensure they comply with China’s personal information protection law, which took effect on November 1, three people with knowledge of the matter said, adding that all employees had to complete training about the new law.

One of the sources said the changes include an updated and lengthy user agreement for customers that clearly defines what data will be collected and how it will be used.

The source said the company is also working on new strategies to recruit drivers for the re-launch, as the uncertainty surrounding the business due to the investigation has led to several rival services moving in.

Its shares have halved since its New York debut, leaving its valuation at $43 billion. The scrutiny comes amid a number of regulatory moves by Beijing that have created benchmarks for a range of sectors from technology to property to private learning.

Notably, China has directed its technology giants to provide more secure storage of user data amid public complaints about mismanagement and misuse, resulting in privacy violations.

The new personal information protection law states that the handling of information must have a clear and reasonable purpose, sets the conditions under which companies may collect personal data and provides guidelines to ensure that the data is stored within the country. To be kept safe when transferred outside.

($1 = 6.3980 Chinese Yuan)

Reporting by Julie Zhu in Hong Kong and Yili Sun in Beijing; Additional reporting by Yingzhi Yang; Editing by David Clarke and Edwina Gibbs

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