China orders ride-hailing firms Didi, Meituan to stop 'disorderly expansion'

Chinese regulators have summoned ride-hailing giant Didi Chuxing and 10 other car platforms to demand they cease "disorderly expansion" and "vicious competition" tactics, the government said on Thursday.

The companies, including the ride-hailing arm of major services app Meituan, were told by regulators on Wednesday that the industry suffered from poor behavior including recruiting unqualified drivers and "shifting the risks of operations onto drivers," according to the transport ministry statement.

The companies were ordered to investigate internal problems and "immediately rectify" poor behavior, with regulators stressing that ride-hailing platforms must also reduce the cut they take from transactions and protect passengers' personal data.

Meituan's Hong Kong-listed stock lost some of its earlier gains and was up only 0.63 percent from the previous day at noon.

China's app-based services have expanded into nearly every aspect of modern life in recent years, with companies in industries including shared bikes and food deliveries engaging in heated discount wars against rivals to gain market share.

The transport ministry on Thursday urged ride-hailing platforms to "maintain a fair competitive market environment" and promote the "healthy and sustainable development" of the industry.