Facebook’s Plan To Open A Chinese Subsidiary

Facebook’s Plan To Open A Chinese Subsidiary
July 25, 2018
Zuckerberg has been trying to cozy up to Chinese President Xi Jinping for years. Ted S. Warren-Pool/Getty Images


Facebook has quietly filed paperwork to obtain a license to establish a subsidiary in Hangzhou, China, Reuters reported on Tuesday.


The social media giant has been trying to make inroads into China for years after the country censored the platform in 2009 when separatists used it during the Urumqi riots. The subsidiary has a registered capital of $30 million, and Facebook Hong Kong Ltd. is listed as its sole shareholder. Its paperwork was filed last Wednesday.


Facebook is setting up the subsidiary as a start-up incubator to advise small businesses and make minor investments, according to the Washington Post. “We are interested in setting up an innovation hub in Zhejiang to support Chinese developers, innovators, and start-ups,” a Facebook spokesperson told the Post. “We have done this in several parts of the world—France, Brazil, India, Korea—and our efforts would be focused on training and workshops that help these developers and entrepreneurs to innovate and grow.”


If the company follows through on the license, this will be Facebook proper’s first subsidiary in mainland China. The social media giant has a sales office in Hong Kong, and its virtual reality company, Oculus, has a branch in Shanghai. Facebook had obtained a license to open an office in Beijing in 2015, and it was looking at possible locations in Shanghai in 2017, though those initiatives fell through.


Even though his platform is blocked in China, CEO Mark Zuckerberg has performed a number of high-profile stunts in an attempt to endear himself to the Chinese people over the years. He’s made a big show of teaching himself Mandarin and spoke exclusively in the language during a 30-minute Q&A session at Tsinghua University in 2014 and during a 20-minute speech at the same university in 2015. He managed to stir up an international media firestorm by posting a picture of himself jogging through Tiananmen Square on a particularly smoggy day in 2016.


Zuckerberg has further tried to cozy up to Chinese president Xi Jinping. Beyond multiple personal meetings, Zuckerberg also reportedly asked the Xi to name his then-unborn child in 2015 and bought copies of the president’s 2014 book for Facebook employees.


Despite Zuckerberg’s schmoozing, Facebook has had little success raising China’s ban to access the more than 700 million netizens in the country. In the years since blocking the platform in 2009 to prevent information about deadly riots in Xinjiang from spreading, the government has also decided to block two additional apps owned by Facebook. China banned Instagram after the 2014 pro-democracy protests in Hong Kong, and it banned WhatsApp in an apparent attempt to step up surveillance efforts to prepare for a major Communist Party meeting in 2017. 

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