One Price of Central Control

The People’s Republic of China’s Cyberspace Administration of China is investigating the alleged wrong-doing of Didi Global’s ride-hailing arm, Didi Chuxing Technology Co; both entities are domiciled in the PRC.

By itself, that’s no big deal; governments are allowed to investigate businesses that regulators suspect of wrong-doing.

Here’s the problem:

No new user registration is allowed during the review….

That’s ostensibly to keep risks from any alleged misbehaviors from growing further.

However. Never mind that Didi Chuxing hasn’t been shown to have misbehaved in any way; it must be restricted.

Suppose that in the end, the regulator indeed finds no actual wrongs done. How would a Didi Chuxing be made whole after the investigation’s closure? How would such a company (re)gain all those missed new customers (for instance)?


[t]he regulator didn’t say how long the review would last….

That damage is made worse the longer the investigation is allowed to go on.

Now, there’s this: how many governments would consider using a regulatory agency or a regulator’s enduring investigation to punish a disfavored business or person solely on political grounds?

I can think of at least three….

And now, just two days after that move, the PRC has ordered app-store operators to remove the app altogether–even though the “investigation” is only just begun.


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