Chinese authorities announced a broad crackdown on China’s ride-hailing industry on Wednesday, targeting market-leader Didi Chuxing with fines following the deaths of two passengers in separate incidents earlier this year.
Didi has violated multiple safety rules, presenting a “major safety hazard”, including failing to properly flag high-risk drivers and improperly handling deposits, China’s Ministry of Transport said in a notice on an official social media account.
“The driver’s qualifications and background checks are not in place. The company’s management of people and vehicles is out of control,” the ministry said, referring to Didi that accounts for around 90 percent of China’s ride-hailing market.
The ministry said it would “severely crack down” on ride-hailing firms hiring illegal drivers and fine Didi’s executives and legal representatives an undisclosed amount of money.
Didi, backed by Japan’s SoftBank Group Corp (9984.T) and the world’s top ride-hailing firm Uber, drew widespread criticism on social media earlier this year after two women were assaulted and killed in separate incidents involving drivers using its carpool service, Didi Hitch.