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On the New York Stock Exchange (NYSE) floor in New York City, United States, on June 30, 2021, a trader works during the IPO for Chinese ride-hailing startup Didi Global Inc. Reuters/Brendan McDermid Didi shares tumbled over 9% in premarket trade on Friday morning after the company’s cybersecurity was reviewed in China, where it is located. New users will not be able to register for Didi’s ride hailing service during China’s cybersecurity review, according to an English translation of the country’s pronouncements. China’s announcement comes just two days after Didi’s initial public offering (IPO) on the New York Stock Exchange. After finishing over 16 percent higher on Thursday, the stock appeared to be on track for another day of gains. Before China made its announcement, Didi’s stock was up roughly 5% in premarket trading. Didi’s representative could not be reached for comment right away. China’s statement also reflects a broader trend of the country’s regulatory attack on previously unregulated technology enterprises. According to Reuters, Chinese regulators are investigating Didi for antitrust crimes. Ant Group’s IPO in Shanghai and Hong Kong was also postponed last fall after Chinese regulators interrogated the company’s top executives, including chairman Jack Ma. In its IPO prospectus, Didi stated that it had engaged with regulators earlier this year. According to the ride-hailing firm, they may face penalties if regulatory bodies are dissatisfied with the inspection results. “We cannot guarantee that the regulatory authorities will be satisfied with the results of our self-inspection or that we will not be fined for any violations of anti-monopoly, anti-unfair competition, pricing, advertising, privacy protection, food safety, product quality, tax, or other related laws and regulations. We anticipate that regulators and the general public will pay more attention to and scrutinize these areas in the future “According to the company’s prospectus. Didi, which was founded in 2012, claims to have 493 million yearly active riders and 41 million daily transactions. It started expanding worldwide in 2018, and it already has 14 locations outside of China. This story is still unfolding. Updates can be found by refreshing the page./nRead More

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