Chinese regulators are concluding their probes into ride-hailing platform Didi, digital freight platform Full Truck Alliance, and online recruitment platform Kanzhun, in preparation of lifting the current ban on adding new users. As a result, these companies’ apps will now be allowed to be listed on domestic app stores and allow new registrants, the Wall Street Journal reported on Monday, citing people familiar with the discussion.
Affected by the news, Didi’s stock price soared by over 60% and Full Truck Alliance’s rose by over 37%, while Kanzhun’s rose by over 20%. But the three companies are expected to face financial penalties while offering the government a 1% stake and direct government involvement in corporate decision-making.
All three companies were listed in the U.S. last June, but soon after, the Chinese government began to strengthen network censorship and conduct data security investigations into these companies. Investigators conducted a month-long on-site investigation into the companies’ internal records, emails and internal communications, but authorities did not find any substantive problems with the companies, according to people familiar with the matter.
Among the three companies, Didi has been the hardest hit and still faces scrutiny from Chinese security departments and relevant departments in the US. A few days after Didi went public in New York, the Chinese regulator ordered the removal of 25 mobile apps operated by the company. It also asked the company to stop registering new users, citing national security and public interest reasons.
Full Truck Alliance has been committed to building an efficient platform to match drivers and consignors. On June 22, 2021, the company was listed on the New York Stock Exchange. In July, 2021, the National Cyberspace Administration carried out a network security review on its apps “Yunmanman” and “Huochebang” and set limits on the registering new users. According to a report by Cailian Press, these apps have now resumed new user registrations.