Yahoo pulls out of China, citing ‘challenging’ environment

Yahoo Inc. said Tuesday it has pulled out of China, citing an "increasingly challenging business and legal environment."

Chinese authorities maintain a firm grip on internet censorship in the country and require companies operating in China to censor content and keywords deemed politically sensitive or inappropriate.

"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 November 1," the company said in a statement.

It said it "remains committed to the rights of our users and a free and open internet."

The company’s withdrawal coincided with the implementation of China’s Personal Information Protection Law, which limits what information companies can gather and sets standards for how it must be stored.

Chinese laws also stipulate that companies operating in the country must hand over data if requested by authorities, making it difficult for Western firms to operate in China as they may also face pressure back home over giving in to China’s demands.

Yahoo was lambasted by lawmakers in the U.S. in 2007 after it handed over data on two Chinese dissidents to Beijing, eventually leading to their imprisonment.

Yahoo had previously downsized its operations in China, and in 2015 shuttered its Beijing office. Its withdrawal from the country is largely symbolic as at least some of Yahoo’s services, including its web portal, have already been blocked.

China has also blocked most international social media sites and search engines, such as Facebook and Google. Users in China who wish to access these services circumvent the block by using a virtual private network (VPN).

Yahoo also previously operated a music and email service in China, but both services were also stopped in the early 2010s.

Yahoo is the second large U.S. technology company to reduce its operations in China in recent weeks. Last month, Microsoft’s professional networking platform LinkedIn said it would shutter its Chinese site, replacing it with a jobs board instead.

Verizon Communications Inc. acquired Yahoo in 2017 and merged it with AOL, but later sold the entity off to private equity firm Apollo Global Management in a $5 billion deal. Apollo announced in September that its acquisition of Yahoo was complete.