Yahoo has become the latest US tech company to end its presence in mainland China as much stricter regulations are imposed there. The company assured, through a statement, that its decision is due to an “increasingly challenging commercial and legal environment” in the Asian country.
Yahoo users in China now get a message saying that the web pages they have searched for are no longer accessible. The company has also ensured that Yahoo’s products and services are not affected in other parts of the world.
Increasingly stringent legal and commercial regulations
In the document provided to the media, Yahoo assures that “it remains committed to the rights of our users and to a free and open Internet. We thank our users for their support.” Yahoo’s move closely follows Microsoft’s announcement last month that it would remove LinkedIn, its business-focused social network, from China, something it also attributed to “a significantly more challenging operating environment and higher requirements for proper compliance. the functions of our company “.
China is in the midst of a large-scale offensive against large Western technology companies , especially those with their headquarters in the United States, as both countries have an underground economic war that has lasted for several years, with product bans and crazy tariffs.
A series of laws passed in recent years contributes to what Yahoo and others characterize as a challenging market for proper business activity . The Personal Information Protection Act, or PIPL, which came into effect on November 1, is one of them.
Exaggerated threats and fines
Designed as a Chinese data protection law, it introduces a series of regulations on how data can be collected and stored, with the threat of exorbitant fines of up to 5% of a company’s annual turnover (5% of turnover annual Microsoft, for example, is several hundred million euros).
Foreign entities that process user information, such as through cookies and web services , must have a presence or designate a representative in mainland China, responsible for the application. In some ways, it is no different from privacy-focused laws, like the GDPR in Europe. But the political environment is significantly different in China from that of many Western nations, with strict censorship requirements.
Some Western tech companies have been criticized for having ties to China or for storing user data there. Even Chinese companies are suffering the effects of a much broader technological crackdown, part of a five-year plan by the state to regulate its economy.
For example, Bitcoin mining has been devastated by a blanket ban on cryptocurrency trading, while Alibaba received a record € 2.8 billion fine earlier this year.
