China expands crackdown on overseas listings with pre-IPO review of companies with big user data

SHANGHAI, July 10 (Reuters) – China’s cyberspace regulator said on Saturday that any company with data for more than one million users must undergo a security review before listing its shares overseas, broadening the repression of its great “platform economy”.

The security review will focus on the risks of data being affected, controlled or manipulated by foreign governments after overseas registrations, China’s Cyberspace Administration said.

Chinese cyberspace regulators are imposing tighter restrictions on data collection and storage, while authorities are pushing more heavily for companies to be listed in the domestic market. Read more

Saturday’s announcement will also require companies to submit IPO documents they plan to file for review. The CAC seeks public opinion on the rules.

The notice comes after Chinese authorities launched an investigation into ride-sharing giant Didi Global Inc (DIDI.N) for allegedly violating user privacy, just days after registering in New York. Read more

Didi’s shares plunged 20% on news of the investigation, and the company said its earnings would be affected.

Reporting by Josh Horwitz; Editing by Tom Hogue and William Mallard

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