Take a peek at the dark history of GitLab

Source Zhihu: https://ift.tt/FX5CQKc

Author: Jinshan Xinfeng

On March 18, 2022, Jihu Information Technology (Hubei) Co., Ltd. (referred to as “Jihu Company”) officially announced its incorporation in Wuhan, China. Official information shows that Jihu is a Chinese joint venture company jointly established by GitLab, Sequoia Broadband and Gaocheng Capital. It is also the first company to enter the Chinese market under the “Sino-foreign joint venture 3.0” framework and has exclusive authorization of foreign leading technologies and brands. High-Tech Companies.

Under the background that open source technology and the independent and controllable industry of Xinchuang have obtained national policy support, let’s take a look at this so-called “Silicon Valley Technology + China Speed” Extreme Fox Company.

1. Does Jihu Company under the Sino-foreign joint venture 3.0 model really have decision-making power?

Jihu has been introducing its special “Sino-foreign joint venture 3.0” model, which is to upgrade the joint venture into a new type of Sino-foreign joint venture with full functions of product research and development, sales and service, and with local decision-making power. Its biggest advantage is that it has local decision-making power, that is, on the board of directors of Jihu Company, the five board members of the board of directors have two foreign seats and three Chinese seats. However, the largest shareholder of Jihu is still Gitlab.

The definition of shareholders’ meeting and board of directors in the “Company Law” of the People’s Republic of China is as follows:

• The general meeting of shareholders is the highest authority of the company, has the right to elect and dismiss directors, and has extensive decision-making power over the company’s operation and management.

• The board of directors is responsible to the general meeting of shareholders. The board of directors convene the general meeting of shareholders, report its work to the general meeting of shareholders, and implement the resolutions of the general meeting of shareholders.

There is no need to say more about the importance of the shareholders meeting and the board of directors. GitLab has ultimate control over Polar Fox and is the largest shareholder in the existing capital structure. Even after more than ten times of industrial and commercial changes, a lot of domestic capital has been increased, but the total share of foreign equity in Jihu Company has exceeded 52.79%.

In addition, in the “GitLab Reports Fourth Quarter and Full Year Fiscal 2022 Financial Results” published by GitLab’s official website in March this year, the positioning of the company is also evident.

(Download report: https://ift.tt/uKPM7Wz)

The first quarter and fiscal year 2023 financial outlook section of the report mentions Polar Fox:

“ for our joint venture in China, GitLab Information Technology (Hubei) Co., LTD (“JiHu”) and Meltano, Inc., our majority owned subsidiary, that are consolidated in our financials.” Translation: In China, Jihu Company is a majority owned subsidiary of GitLab and is incorporated in our financials.

This makes it clear that GitLab is a subsidiary of GitLab, and that GitLab and GitLab have merged financials.

The balance sheet for the first quarter of 2022 also noted that Jihu and GitLab were consolidated:

“ As of January 31, 2022, the consolidated balance sheet includes assets and liabilities of the consolidated variable interest entity, GitLab Information Technology (Hubei) Co., LTD (“JiHu”), of $17.7 million and $3.7 million, respectively.

The author has also checked China’s regulations on consolidated financial statements. When the parent company has half or less of the voting rights of the investee, it can only consolidate financial statements if one of the following conditions is met:

1. Possess more than half of the voting rights of the investee through agreements with other investors of the investee;

2. According to the company’s articles of association or agreement, it has the right to decide the financial and operating policies of the invested entity;

3. The right to appoint or remove the majority of the members of the board of directors or similar institutions of the invested entity;

4. The majority of voting rights in the board of directors or similar institutions of the investee.

It is known that GitLab has a 46.8099% stake in Jihu, and it is known that Jihu and GitLab are consolidated, so where is the control of China’s Jihu? The answer is already very clear.

To sum up, the “decision-making power” claimed by China Extreme Fox in various circulars is only three-fifths of the board seats that are not decisive and can be appointed or removed by Gitlab at any time, and that’s it.

2. The unforgettable black history of GitLab

Whether the Sino-foreign joint venture 3.0 Jihu company is just a cover for foreign capital to enter China’s Xinchuang industry, we do not know. But the “black history” of Gitlab must not be forgotten for us!

In November 2019, GitLab released a statement on its official website saying that they had decided to enable a “work home country block” order for team members with access to customer data, and only for China and Russia. The updated recruitment process clearly stipulates that GitLab will not provide offers to Chinese/Russian citizens. Also, those employees who have access to customer data cannot now move to China or Russia

On October 3, 2020, GitLab blocked access by Iranians. Five days later, some developer accounts in the region were blocked and not even allowed access to their own projects. They can only export the developer’s personal project even if they ask for temporary access, and GitLab refuses to unblock it. As a Chinese subsidiary with absolute control of GitLab, is there such a risk as GitLab?

After the establishment of Jihu Company in China, the “saucy operation” with China Unicom also caused everyone to have many questions about Jihu Company. In November 2021, China Unicom purchased the GitLab Professional Edition of Jihu’s product in the form of “single source procurement” in a R&D software purchase. Of course, if you purchase high-quality products, there are no substitutes in China, which is understandable. And China Unicom chose the form of “single source procurement” , that is , no other company has what I want, so I can only buy this. As we all know, GitLab has many excellent competing products of the same type in China, and a single source of purchase is never established.

More importantly, national information security is highly valued by state-owned enterprises and central enterprises, and China Unicom, one of the three core operators, uses GitLab products to manage the most core information asset source code, whether from a security perspective or from an independent and controllable perspective. There are big problems. What is hiding behind this collusion? The author dare not think about it.

What is even more terrifying is that after the start of the Russian-Ukrainian war, GitLab has completely suspended its business in Russia and Belarus. At present, the situation in Russia is extremely difficult. Being sanctioned by technology giants, Russia has been completely cut off from supply by the United States and the West. Technology without borders has become an empty talk.

And my country is facing the situation in the Taiwan Strait, and there may be a war between China and the United States. If a similar scenario repeats in China in the future, the United States and the West will definitely be more severe to contain China than to contain Russia. How can China avoid Russia’s outcome today? Be prepared for danger in times of peace and take precautions, and problems such as “stuck neck” and “subject to others” in core technologies must not occur.

3. What is the purpose of GitLab to enter China?

Regarding its entry into China, the introduction of Jihu company is: “In order to better serve Chinese users, connect with Chinese partners, and at the same time give Chinese companies the ownership of independent development and core technology. And the GitLab agreement stipulates to provide Jihu company with exclusive intellectual property rights and brands. Licensing, keeping the source code in sync and continuously updated.”

In all introductions and drafts, Jihu always avoids talking about the account security and code storage of domestic GitLab users. Although Jihu company emphasizes on the official website that “Jihu GitLab attaches great importance to compliance, because we know how important security and accessibility are to our customers and stakeholders.” But it is not difficult to find that security compliance All of the documents are US documents, not Chinese laws and regulations.

At the national policy level, “safe and reliable”, “network security” and “domestic substitution” have all become key words in the policy content in the past two years. Perhaps under such a policy background , GitLab must have a “reasonable Chinese identity” to enter the Chinese capital market and achieve their goals.

Chen Ran, CEO of Jihu Company, showed his “fighting spirit” many times at the press conference: he plans to lead Jihu to be listed on the Science and Technology Innovation Board or the main board within 3-5 years. The listing of Sino-foreign joint ventures in China requires a very strict review, but since 2021, there have been rumors that China will promote the issuance and listing of overseas companies on the A-share market, and the international board will soon be put into practice.

And GitLab’s subsidiary, China Jihu Company, also chose to be incorporated in China in 2021, and has attracted many Chinese capital to join, not shy about its listing ambitions. Let me ask, is GitLab entering China to better serve Chinese users, or to better harvest Chinese leeks? Whether the so-called “Silicon Valley technology + Chinese speed” is a new way for American companies to make money in China’s capital market remains doubtful.

4. Information security is the bottom line of the country

DevOps products such as GitLab Professional Edition, a product of Jihu Company, are basic software in my country’s Xinchuang industry. Basic software is the core component of an information system. It is an important position and the last line of defense to ensure the security of an information system . Self-controllability is related to national security and interests, and is also the basis for the independent development of the industry.

With the help of “open source” and “A-share international board”, GitLab, which is full of black material, has aggressively entered the Chinese market and established a so-called “independent decision-making” Jihu company. The behavior of selling dog meat is really unconvincing.

The international situation is tense, and the Western and American imperialists are eyeing them. The “extreme fox companies” wear sheepskins registered in China, but inside are ulterior motives of American imperial products. Under the chaotic international situation, if government departments, central state-owned enterprises, financial industry, military industry, and national high-tech departments do not take precautions, the consequences will be disastrous!

The alarm bell of national information security must be ringing! China’s digital road needs to rely on the continuous progress of domestic software. autonomous and controllable,

The text and pictures in this article are from the OSC open source community