The app logo of Chinese ride-hailing giant Didi is seen reflected on its navigation map displayed on a mobile phone in this illustration picture taken on July 1, 2021.HONG KONG/BEIJING - China's $1.2 billion fine on Didi Global draws a line under the ride hailing company's regulatory woes, but the retroactive application of laws and a lack of clarity on the firm's business revival show the worst for its tech sector may not be over.
Authorities have, in recent months, softened their tone on the crackdown as they seek to boost an economy hurt by Covid-19 containment measures, and the probe into Didi was among cases being closely watched for clues on how this could play out. If the fine was far lower, like 1 billion yuan , "that could have boosted some of our confidence", said one executive from a Chinese technology giant, declining to be named citing the sensitivity of the matter.
"It will be more and more restricting for internet companies. Except for obeying the orders of the CAC, there is no other way for internet companies," said You Yunting, senior partner at Shanghai DeBund Law Firm.Beijing launched the crackdown on its huge homegrown tech sector in late 2020 as part of a campaign to strengthen control over large swathes of its economy as it prepared for Chinese President Xi Jinping to secure an unprecedented third term as party leader later this year.