2 February 2024

In the jargon, they are called “golden shares”: “golden shares”, which give special rights to their owners. The purchase of only 1% of the capital in “special management shares”, their official name, allows the Chinese State to sit on the board of directors of a company. In 2021, the fund managed by the Cyberspace Administration of China, the web regulator, took a 1% stake in the main Chinese subsidiary of ByteDance, the owner of TikTok and Douyin.

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Thanks to this investment of only 2 million yuan (267,000 euros), the regulator was able to place one of its officials on the board of directors of the company, which has only three members, according to the statutes consulted by the FinancialTimes. More recently, in January, the Chinese authorities carried out the same operation in a subsidiary of the giant e-commerce Alibaba. And they want to do the same at Tencent, number one in social networks and video games in China.

The practice of “golden shares” allows the Communist Party to control companies more and more. Chinese groups cannot refuse the authorities anything: a cybersecurity law adopted in 2017 requires any citizen or organization to “support, assist and cooperate with national intelligence work”. A text reinforced by the Data Security Act of 2021, which classifies certain company data as national security information.

“Golden Handcuffs”

“We should rather call them golden handcuffs, ironically Duncan Clark, founder of BDA China, a consulting firm, and author in 2016 of a biography of Jack Ma, the founder of Alibaba. The “golden shares” allow the authorities to ensure that they have control, in particular over the data. Regarding ByteDance, or (the VTC platform) Didi, there was the fear that the United States could have access to Chinese data. But Xi Jinping wants to have absolute control over it. »

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These measures make it difficult for Chinese companies to expand overseas. A few years ago, the suspicion focused on the telecom giant Huawei, accused of allowing the Chinese authorities access to the data of its customers. The Chinese telecom leader has been banned by many Western countries.

Today, it is the turn of TikTok: questioned on this subject, on March 23, by the American elected officials, Shou Zi Chew, the CEO of the company, replied that “The Communist Party has no voting rights in ByteDance”arguing that these shares are held in a Chinese subsidiary, and not the parent company of the group.

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