Didi shares crash as Beijing cracks down after New York float

Beijing announced a cybersecurity review into Didi on Friday and blocked Didi from accepting new customers.

On Sunday, regulators ordered app stores in China to remove the Didi app entirely, severely limiting the company’s ability to do business.

“The company will strive to rectify any problems, improve its risk prevention awareness and technological capabilities, protect users’ privacy and data security,” the company said.

The fall in Didi shares was delayed after US markets were closed on Monday for the Fourth of July holiday.

China’s state council said on Tuesday that it plans to crack down on securities violations and increase supervision of
Chinese companies listed abroad. It also said it would change the rules on foreign listings but did not specify what changes would be made.

Listed companies will be held liable for the security of their data, the state council added.

Peter Garnry at Saxo Bank commented: “It is a big step from China, but on the other hand it is part of series of events that started over a year ago. The uncertainty is still over to what degree all of this regulation will impact longer-term profitability.”

The Cyberspace Administration of China has opened investigations into a series of US-listed Chinese technology companies.

Last week it also announced probes into recruitment firm Boss Zhipin and subsidiaries of commercial freight company Full Truck Alliance, which floated in New York last month.

Didi’s US listing was the largest float of a Chinese company in the US since Alibaba’s $25bn debut in 2014.

The business empire of Alibaba founder Jack Ma has been examined by Chinese authorities who forced it to abandon a planned float of his payments company Ant Group.

Mr Ma vanished from public view for months at the end of last year, only resurfacing in January.

 Didi did not respond to a request for comment.

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