The U.S. company famous for its email services announced that it stopped providing services entirely in mainland China as of Nov. 1 due to legal regulations the Chinese Communist Party (CCP) imposes on companies to operate in the country.
“In recognition of the increasingly challenging business and legal environment in China, Yahoo’s suite of services will no longer be accessible from mainland China as of Nov. 1,” a Yahoo spokesperson told Reuters in an email on Tuesday.
“Yahoo remains committed to the rights of our users and a free and open internet. We thank our users for their support.”
Yahoo was the second American company after LinkedIn to leave the country last month.
However, Yahoo had considerably reduced its services in China and barely maintained weather forecast applications and some foreign news sites.
Forced to spy for the CCP
Shi Tao, a Chinese freelance journalist, was arrested in 2004 for sending an email from his Yahoo account with photos and information about the CCP’s censorship of news about the Tiananmen Massacre.
The family sued Yahoo for handing over the journalist’s private data to the CCP, but Yahoo said the authorities forced it.
A year later, in 2005, Yahoo sold a 40% stake in its mail service to China’s Alibaba Group.
Yahoo’s complete withdrawal from China is no coincidence.
As of Nov. 1, a series of laws and regulations that the CCP implemented to increase control over the personal information that foreign and domestic companies handle goes into effect.
According to a report in the South China Morning Post, under the new laws to regulate cyberspace, companies will be required to store personal information—loosely defined in the Personal Data Protection Law—on Chinese servers, those who send personal information outside China without authorization will receive fines ranging from $7,000 to more than $15,000, and even individuals involved will receive similar fines.
While the CCP says the set of laws protects the “sovereignty” of its cyberspace, dozens of reports and experts have criticized Beijing for using these regulations to steal intellectual property and collect personal data from its users.
Edward You, national counterintelligence officer for emerging and disruptive technologies—a CIA unit—said that BGI, a genetic research company headquartered in Shenzhen that provides cost-effective services to U.S. hospitals and companies, created a database of U.S. patients’ DNA information.
Last month, the U.S. National Counterintelligence and Security Center launched a campaign to raise awareness in the U.S. business community about the dangers of doing business with Chinese companies because of the close relationship they have with the intelligence services, the military, and the CCP that forces them to give access to confidential information of their clients and partners.
In other words, to operate in China, companies are forced to violate ethical and security standards that they have pledged to uphold in their home countries, which is perhaps the reason why many companies are ceasing their operations there.