China opens anti-monopoly investigation into e-commerce giant Alibaba
(Update 1: adds closing share price in par 3)
Beijing, Dec 24 (efe-epa).- China’s top market watchdog announced Thursday that it has opened an anti-monopoly investigation into e-commerce giant Alibaba.
The “suspected monopolistic conduct” includes trying to make wholesalers choose a single platform between two competitors, the State Administration for Market Regulation said in a brief statement.
The news had an effect on the company’s shares on the Hong Kong Stock Exchange, plunging 8.13 percent for Christmas closing.
State news outlet People’s Daily said in an article Thursday that the investigation “is an important measure to strengthen anti-monopoly oversight in the internet sphere.”
“This will be conducive to standardizing the order of the industry and promoting the long-term and healthy development of platforms,” it added It comes as the central bank and three financial regulators are due to begin a round of talks in the coming days with the financial technology company Ant Group, a subsidiary of Alibaba.
The People’s Bank of China, the China Banking and Insurance Regulatory Commission, the China Securities Regulatory Commission, and the State Administration of Foreign Exchange will “urge and guide Ant Group to follow market-driven and law-based principles, implement requirements regarding financial supervision, fair competition and protection of consumers’ legitimate rights and interests, and regulate the operation and development of its financial businesses,” another state news agency, Xinhua, reported.
On Dec. 14, the Chinese market regulator announced the imposition of fines amounting to 500,000 yuan ($76,500) to both Alibaba and a unit of Tencent for failure to notify concentration of undertakings in advance, therefore breaching the anti-monopoly law.
The fact that the authorities imposed the maximum fine contemplated by the regulations, despite both Alibaba and Tencent being valued at more than $700 billion, highlights that antitrust oversight is increasing in China’s digital sector.
The Ant group said Thursday in a statement that it has received the notice for the meeting with Chinese regulators and that it will strictly comply with all the requirements established by the regulations. EFE-EPA