Yahoo said Tuesday it is pulling out of the Chinese market amid a crackdown on foreign tech firms that has increased the risks of operating in China.

Yahoo’s move comes less than a month after Microsoft shut down its LinkedIn social-networking site in response to Beijing’s tightening control of the tech industry.

“In recognition of the increasingly challenging business and legal environment in China, Yahoo’s suite of services will no longer be accessible from mainland China as of November 1,” a Yahoo spokesman said.

Yahoo had previously downsized its operations in China, dropping a music and email service in the early 2010s and shuttering its Beijing office in 2015.

The departure from China, while “largely symbolic,” is still “a reminder of the increasing challenges foreign companies face in operating in China, including tighter data security and privacy regulation, geopolitical tensions and tough COVID-19-related rules,” according to The Wall Street Journal.

On Monday, China implemented a new data protection law that limits the conditions under which companies can gather personal information and sets rules for how it is used. Chinese laws also require companies operating in the country to hand over data if requested by authorities, making it difficult for international firms that may face pressure at home over giving in to Beijing’s demands.

The new regulations have increased the uncertainty and compliance costs of operating in China, and some companies are preferring to pull out rather than deal with the added business risk, Cameron Johnson, a Shanghai-based management consultant at FAO Global, told the Journal.

Yahoo entered the Chinese market in 1999, launching email and search directory services, and offering translations of U.S. news articles. Since 2005, most of its Chinese operations had been run by Alibaba Group Holding.

“The Baidu search engine has largely replaced Yahoo and Google in China, and WeChat and Weibo are the leading social media platforms,” the Associated Press reported.

The products affected by the withdrawal include Aol.com and news outlets such as TechCrunch. Users of Yahoo Weather were told in October that it would be discontinued this month.

Photo by Guang Niu/Getty Images

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