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Probably because of the cost of legal compliance. Various AI providers also banned Europe because until they were ready for GDPR compliance. China has even stricter rules w.r.t. privacy and data control: a lot of data must stay inside China while allowing authorities access. Typically implementing this properly requires either a local physical presence or a local partner. This is why many apps/services have a completely segregated China offering. AWS's China region is completely sealed off from the rest of AWS, and is offered through a local partner. Similar story with Azure's China region.