Administrative Guidance on Chat Application Giant

Ministry of Internal Affairs and Communications made an administrative guidance on Line Yahoo Corporations, asking improvement in security of its social networking service. The company announced last November that it outflew a large amount of its customer information. The ministry demanded Line Yahoo revising its relationship with foreign companies, as unusual intervention to management of corporation. 

Line has 96 million users in its chat application. It revealed last November that its server received cyberattack and the information of 440 thousand users was stolen. It later revised the amount to 510 thousand. In addition, it was found that its subcontractor in Republic of Korea possibly lost its information of 57 thousand workers last month.

 

Before merging with Yahoo last October, Line was given another administrative guidance when it put its customers’ information in a situation of disclosed in its subcontractor in China in March 2021. The MIAC also made the guidance last August when it sent information of uses’ location to Naver, the parent company in ROK, without notice in advance.

 

Line was originally a subsidiary of Naver, and it outsources a part of its business to Naver. A computer of subcontractor of Naver suffered from cyberattack and it affected to Line last November. MIAC found that the outflown information included the date of telephone talks of users, which violated the legal mandate for protecting secret of communication. MIAC required Line Yahoo to improve protection of communications and achieve enough cyber security, with measures not to repeat the same damage.

 

Naver has 50% share of A Holdings, the holding company of Line Yahoo. Another half is occupied by Softbank. A Holdings possesses 64% share of Line Yahoo. MIAC raised Line Yahoo’s high dependency on Naver as fundamental reason of the incident. “In spite of great risk that the information would be drained from Naver, with which Line Yahoo shared its network, you failed in taking enough measures to protect your system, allowing malicious access,” said the guidance.

 

Line has grown to be one of the giants in information technology in Japan as a tool of easy communication. This social infrastructure is not only necessary for people’s daily life, but also for business activities or public service. A number of local governments use the application for their public service. The outflow of its customers’ information has a great impact on Japanese society.

 

Line Yahoo is registered as one of the companies of specially designated social infrastructure under the Economic Security Promotion Act. In the context of economic social security, which the government of Japan recently promoting, cyber weakness of Line seemed to be a possible threat of Japan’s security.

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