Chinese tech giant Tencent, the owner of WeChat, is scrambling to make its ubiquitous all-in-one app more compliant with the fickle and complicated regulatory environment in the United States, even though a court ruling last month mandating a reprieve from President Donald Trump’s ban means some breathing room for Tencent and the many Chinese and American businesses that rely on the super-app.
Hinting at Tencent’s future moves, the company updated its US user agreement last month with an addendum dedicated to users in California, after the most populous US state, which also has the largest WeChat user base across the nation, enacted the California Consumer Privacy Act (CCPA).
Tencent has committed itself to “free and swift” disclosure of WeChat’s data collection, analyses, transfer and sale concerning users in California.
However, Tencent stressed that within the past 12 months it had not sold the personal information of Californian WeChat users in transactions that could fall into the jurisdiction of the CCPA.
In its Privacy Protection Policy, Tencent also notes that the information of accounts inactive for 180 consecutive days would be permanently deleted, while the chat history of active users would be kept in its servers for no more than 72 hours. Users are given the discretion to save their chat history on their phones and export it to another device. The company added that servers for international WeChat users were located in Ontario, Canada, Hong Kong and elsewhere but not in Shenzhen in mainland China, its home city, or elsewhere in mainland China. It added that its transfer of personal data to third countries would conform strictly with the European Commission’s model contracts.
“Rigorous internal control measures are undertaken to strictly limit access to users’ data by designated team members and that both Canada and Hong Kong have stringent and well-rounded privacy and data protection regimes,” assured Tencent in a statement.
But the company did not reply to e-mailed inquiries about how it would strive to protect user privacy and their data and how it would handle requests from authorities to share data, now that Beijing has foisted a vaguely-worded national security law on Hong Kong since July.
Wu Shenkou, the director of the Beijing Normal University’s Cyberspace Law Research Institute, told reporters that even though WeChat’s sheer user base and American businesses’ dependence on it may add to its leverage against the Trump’s ban, the app could have done better in terms of complying with changing US federal and state laws.
“The fragmentation of the Internet can be unavoidable if other countries, in particular, Washington’s allies, take a page out of Trump’s playbook and hone in on WeChat,” said Wu. He added that the US government was unlikely to drop the case against WeChat in toto, even if there is a new tenant in the White House after November: “The US Commerce Department, even under the Biden administration, may still rejigger its strategies and come up with new charges and restrictions.”
Tencent has also reportedly changed the name of WeChat’s international corporate versions to WeCom in a bid to work around the US ban.
It has also been revealed by the Beijing-based Caijing magazine that Tencent is seeking to foster a stronger alliance with existing partners for joint lobbying in Washington, and, Apple, Walmart and Starbucks – which rely on WeChat and its payment service for a lion’s share of their takings across China – have emerged on Tencent’s radar.
Leading consumer electronics analyst Ming-chi Kuo of TF International Securities previously estimated there would be a 25-30% slump in iPhone sales in the Greater China Region, Apple’s second-largest market that also includes Hong Kong, Macau and Taiwan, in the worst-case scenario if the iPhone-maker had to pull WeChat from its AppStore to conform to the US ban.
“An AppStore without WeChat may deal a more crippling blow to Apple than the impact on Tencent or Huawei, whose phones can no longer run Andriod systems,” said Kuo.
Apple did not reply to inquires about the reported cooperation with Tencent to enhance its policy communications with the US authorities.
Caijing also reported that US personal care giant Procter & Gamble relied solely on WeChat for the employees at its China headquarters and across several plants there to communicate and coordinate production and promotion.
Wu, the Beijing Normal University scholar, said it would be safer for Tencent to woo more WeChat stakeholders through profit and technological sharing and bring its data and privacy standards closer to the international level. He also said that it was wise for Tencent to divorce the operation of WeChat serving international users from its core business that mostly catered to mainland Chinese.
Tencent has Netherland- and Singapore-based subsidiaries, Tencent International Service Europe BV, Tencent International Service Pte Ltd and WeChat International Pte Ltd, which run WeChat’s international business.
The company may also get inspiration from how TikTok picked Oracle to process and store data within the US, in its own bid to resolve legal rows that the US ban may entail.
The US Commerce Department, meanwhile, is yet to produce proof to back up its allegations that WeChat’s US version “automatically harvests a huge chunk of data from American users and enables Beijing access to the personal and proprietary information of Americans,” more than two months after Trump threatened to ban the app on national security grounds.
Michale Bien, an attorney for the US WeChat Users’ Alliance, which represents mostly Chinese immigrants and Chinese Americans who form the majority of the app’s user base in the country, was quoted by Caijing and the China News Service as saying that the lawyers employed by the US government had sought to drag out the legal proceedings and said hearings of related cases should be adjourned, pending more details about the implication of the WeChat ban to be worked out by the Commerce Department.
Tencent previously said it had no links with the alliance or the latter’s charges against the US government.