The Chinese government appears to have shut down Facebook’s establishment of an office in Hangzhou, almost before it had got off the ground.
The New York Times reported that the company filing documents had been removed from the register of companies on Wednesday. Only two days earlier, photographs of the filing had circulated widely on Chinese social media. Media reports circulated on Tuesday, apparently corroborated by email conversations with the U.S. tech giant. Facebook did not reply to emailed inquiries from Variety.
The New York Times said that the removal of the documents reflected a disagreement between local officials in Hangzhou, Zhejiang province and the Cyberspace Administration of China, with the CAC, apparently, wanting better notification before the U.S. tech giant set up camp behind the so-called great Firewall.
The office had been described by Facebook as an innovation hub,similar to those it operates in other countries in Asia and Europe. The filing had showed that it was wholly-owned by Facebook Hong Kong, which operates from outside mainland Chinese jurisdiction.
An alternate explanation for the reversal, is that Facebook has been caught up in part of the ongoing trade war between the U.S. and China, which began in earnest a few weeks ago when the White House imposed tariffs on $50 billion of goods imported from China. Thursday also saw the cancellation of the $44 billion proposed takeover of China’s NXP Semiconductor by the U.S.’s Qualcomm, after Chinese regulators failed to approve the deal.
Facebook has had a tough week. Its shares plunged 20%, wiping out $150 billion of valuation on Wednesday, after its reported second quarter revenues missed financial market forecasts.
Facebook’s main social media platform operations are blocked in China. So too is most functionality of the Facebook-owned messaging service Whatsapp. Local companies operating in the social media and messaging space are required to comply with China’s censorship regulations and provide access to regulators through servers located in the country.