Hong Kong’s most valuable company, Tencent, has dismissed claims the arrest of one of its executives is to do with allegations over the sharing of personal data from its popular WeChat app.
The tech giant says the executive is being held by Chinese authorities over allegations of 'personal corruption’ in the latest move in Beijing's crackdown on its home-grown internet platforms.
And it’s not been a good week for Tencent Holdings Ltd as it has also been hit by a fresh anti-monopoly complaint to regulators, this time from a supplier of smart vehicle technology and a General Motors Co China venture.
The supplier, Shanghai PATEO, has accused Tencent of abusing its messaging app's dominant market position to restrict sales of its products.
The new complaint comes just a week after ByteDance's Chinese version of TikTok – Douyin – accused Tencent of monopolistic behaviour and filed a suit in a Beijing court, seeking 90 million yuan ($14 million) in compensation. Tencent denies the claim.
Observers say the allegations against one of their executives is part of a wider campaign targeting some of China’s technology innovators and private-sector champions over violations of anti-trust and data privacy rules.
The Tencent executive was being held by the authorities as part of an inquiry into a high-profile corruption case involving one of the country's former top law-enforcement officials, it’s claimed.
Zhang Feng has been under investigation by China's anti-graft inspector since last year over alleged unauthorised sharing of personal data collected by Tencent's social-media app WeChat.
But Tencent says that Zhang's case is not related to its international WeChat app or domestic Weixin platform. It declined to elaborate further.
"This is just one more instance of Beijing entrenching control over the large and powerful tech giants under its purview," LightSTream Research analyst Mio Kato said.
"This seems like an extension of the previous anti-corruption campaign that was focused on the political structure."
The report comes as Chinese regulators and state media are becoming increasingly vocal about the infringement of consumer rights by tech companies, which use personal data to drive businesses, from selling products to acquiring customers.
- Reporting by Reuters