Update: Didi refutes rumors claiming it hands over Chinese user data to the US after listing
Published: Jul 02, 2021 09:12 PM
The headquarters of DiDi in Beijing Photo:VCG

The headquarters of DiDi in Beijing Photo:VCG

Didi Chuxing on Saturday refuted rumors claiming it hands over Chinese user data to the US after its listing on the New York Stock Exchange (NYSE). Didi's statement comes as the country launches a review into the ride-hailing giant in a bid to prevent national data security risks and protect the public's interests.

"Like many other Chinese firms listed overseas, all of Didi's domestic user data are stored in domestic servers and there is no possibility to hand them to the US side," said Didi Vice President Li Min, the Global Times has confirmed. Li also added that the company will launch lawsuits against those who spread rumors to protect its rights and interests.

China's cybersecurity review office said Friday it was launching a review into Didi Chuxing, which sparked some speculation that the company might have handed over user data to the US Securities and Exchange Commission (SEC) to get listed on the NYSE.

"Technically, it's unlikely for the company to hand over Chinese user data to the US, as the data base is as huge as petabyte level and couldn't be copied by simply using a hard disk," Ma Jihua, a senior tech industry analyst based in Beijing, told the Global Times on Saturday. 

In addition, an IPO checks a company's financial figures and materials to show that its business is profitable and promising, he said, noting that the SEC will not ask for the company's underlying technologies and data.

However, Didi is indeed reckless as it should have addressed data security concerns before its IPO on the NYSE, Ma said. "Compared with the e-commerce data of Alibaba's Taobao and the social media data of Tencent's WeChat, Didi's user data are more sensitive because a user's identity can be inferred via their route information," he said, noting that the country's road information is also very important.

Though the potential risk is not as severe as some people think, a conclusion can only be drawn after the review.

Throughout the review period, new user registration for Didi Chuxing will be suspended to stop the spread of risks, the office said in an announcement on Friday, without revealing how long the cybersecurity review will last.

"Didi will actively cooperate with the cybersecurity review," the company said in a statement sent to the Global Times shortly after the announcement. 

The ride-hailing firm pledged to troubleshoot cybersecurity risks under the supervision and guidance of the relevant departments and continue to improve its cybersecurity system and technological capabilities. 

Shares of Didi plunged in the US pre-market on Friday, reversing earlier gains, after the cybersecurity review announcement.

Didi raised $4.4 billion in an IPO on the New York Stock Exchange on Wednesday. Its shares soared 15.98 percent on Thursday after ending up 1 percent on the debut day.

The company is due to be added to S&P Dow Jones' global equity indexes later this month. 

Global Times