«If Yahoo HK were a wholly owned
subsidiary of a
PRC - domiciled company (let's call it «Yahoo China Parent»), then there would be a plausible case for saying that Yahoo China Parent could be required by the Chinese government to cause its wholly owned HK
subsidiary to do certain things.
«Yahoo HK is certainly not subject to
PRC law; but it's
subsidiary Yahoo Beijing is, and the
PRC authorities no doubt made it clear (either explicitly or subtly) that if Yahoo HK did not chose to comply with their «request», they would make like rather difficult for Yahoo Beijing.»