China’s market regulator is investigating Didi on whether it violated antitrust rules, Reuters reported Wednesday night. Didi called the report “unsubstantiated speculation.”
Why it matters: The probe report comes less than a week after the ride-hailing giant filed for a US IPO on Thursday. It remains to be seen whether the news will affect the company’s plan to go public.
- A slew of tech major Chinese companies have faced antitrust scrutiny in the last year as part of a broad push to regulate the country’s powerful tech sector.
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Details: Unnamed sources told Reuters that China’s market regulator, the State Administration for Market Regulation (SAMR), is looking at Didi on suspicion of anti-competitive practices.
- Regulators are also investigating whether Didi used anti-competitive practices to squeeze out smaller rivals, and whether Didi manipulated the price of rides, Reuters wrote.
- The probe is in early stages, and the regulator has not yet given detailed instructions to Didi, according to Reuters’ report.
- A Didi spokesperson told TechNode on Friday that it refused to comment on “unsubstantiated speculation from Reuters’ unnamed sources.”
Context: Didi, dominant in China’s ride-hailing market, has been fined several times this year by market regulators for antitrust violations.
- In March and April, SAMR fined Didi’s subsidiaries a combined RMB 2 million (around $310,000) for insufficiently disclosing past acquisitions and investments for antitrust reviews.
- Didi was punished in April alongside several other Chinese tech giants, including Tencent and Meituan, for failing to seek antitrust clearance for their investments.
- Didi has dominated the ride-hailing market since merging with Alibaba-backed Kuaidi in 2015. A year later, Didi bought out Uber’s China business as the American rival left the market.