China Orders 25 Tech Giants to Fix Raft of Problems

(Bloomberg) — China ordered more than two dozen technology firms to carry out internal inspections as part of a campaign to root out illegal online activity.

The Ministry of Industry Information Technology on Friday told 25 of its largest internet and hardware companies including Alibaba Group Holding Ltd. and Tencent Holdings Ltd. to carry out internal reviews and rectify issues ranging from data security to consumer rights protections. The twin giants and 10 other firms were also asked separately on Wednesday to step up data security protections, including the export of key information, by the Internet Society of China, which was acting on behalf of MIIT.

The meetings this week come after the internet industry regulator announced on Monday it was beginning a six-month campaign to crackdown on illegal online activity. Days later, it told Tencent and 13 other corporations to address problems related to pop-ups within their ads. The crackdown is the latest move by Beijing to rein in the country’s internet leaders in areas from antitrust to data security and ride-hailing.

Meituan, Xiaomi Corp. and ByteDance Ltd. were among firms summoned to both meetings. On Friday, the MIIT ordered the companies to address eight types of problematic behavior including pop-ups, data collection and storage as well as the blocking of external links.

At the earlier session, the firms were asked to ensure that they establish data security management systems and appoint personnel responsible for data security, as well as strengthen oversight of how important information is exported, according to a statement Friday. The companies didn’t immediately respond to requests for comment.

Xi Jinping’s government has made data security one of its top priorities in its campaign against the internet industry. The cyberspace regulator had cited data security risks as a key reason for its investigation into Didi Global Inc. and has proposed a law requiring virtually all companies seeking to go public outside China to seek approval.

Read more: China’s Didi Crackdown Is All About Controlling Big Data

Big data is quickly turning into the next major battleground in a clash of superpowers, with implications that potentially could reshape the global economy for decades to come. With the U.S. lobbying other nations to prevent China from obtaining technology like advanced computer chips and Xi undertaking a national project to develop them, stringent data security controls risk further disrupting supply chains, balkanizing financial markets and forcing countries to pick sides.

(Updates with Friday meeting in third paragraph.)

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