Congress savages Yahoo over China

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Yahoo executives received a roasting from Congressmen from both sides of the political spectrum in an emotionally charged hearing of the US House Foreign Affairs Committee..

Yahoo chief executive Jerry Yang and general counsel Michael Callahan were being questioned about the arrest of Chinese human rights activist Shi Tao, which occurred after Yahoo handed over his user information to the authorities.

"While technologically and financially you are giants, morally you are pygmies," said Democratic Committee chairman Tom Lantos, according to the New York Times.

Lantos urged both executives to apologise to Shi Tao's mother, who was sitting directly behind them. They acknowledged her, but said nothing.

Meanwhile, Republican Congressman Chris Smith compared Yahoo's stance to companies that cooperated with the Nazi regime.

Callahan argued that Yahoo had no choice but to operate under local laws. He has also apologised for unintentionally giving misleading evidence on the matter.

"I cannot ask our local employees to resist lawful demands and put their own freedom at risk even if, in my personal view, the local laws are overbroad," he said.

When Callahan pointed out that Yahoo's China operations were now run by Chinese company Alibaba.com, Smith called the practice "plausible deniability".

Yahoo has a 40 percent stake in Alibaba. Other investors include Cisco Systems and Softbank. Alibaba shares doubled in price to value the company at US$25.7 billion during its first day of trading yesterday in Hong Kong.

During further questioning Callahan stated that Yahoo could not say whether the company was going to help Shi Tao and his family.

He also could not say whether Yahoo had been asked for information on anyone else in China, or that it would react differently if the situation arose again.

Callahan did, however, state that Yahoo would be taking lessons from its experience in China when opening a new business in Vietnam.

"I would hope to have a structure in place ... that we would be able to resist those demands or have that data not be accessible," he said.
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