China files anti-monopoly investigation on e-commerce giant Alibaba

Author : Saipriya Iyer | Published Date : 2020-12-25 

Chinese regulators have recently filed for an anti-monopoly investigation into retail giant, Alibaba and have called in its online finance subsidiary Ant Group for talks, creating an increased pressure on the e-commerce firm founded by Jack Ma, the renowned Chinese tech entrepreneur.

Meanwhile, China Banking Regulatory Commission, China Securities Regulatory Commission, The People’s Bank of China and State Administration of Foreign Exchange have stated that they would also hold a meeting with Ant Group for discussion on supervisory and guidance. For the record, Ant Group is Alipay’s developer, a mobile payment system which is ubiquitous and essential for China’s economy.

Further, Ant Group has also stated that it would thoroughly study and strictly adhere with the requests of regulatory departments.

It has been reported that the regulators had warned Alibaba earlier regarding the “choosing one from two” methodology under which merchants are required to sign exclusive cooperation agreement which prevents them from offering products on competitor platforms.

An editorial in the People’s Daily stated that the measures for preventing monopoly and anti-competitive practices were required for improving the socialist market economy system and encouraging high-quality development. This investigation however does not indicate that the country’s view towards the encouragement and support for the platform economy has changed.

Reportedly, Alibaba shares fell to 5.48% shortly after the Hong Kong stock exchange opened on Thursday morning.

Reportedly, Ant Group, Alipay, Ant Financial were gearing up for what would have been the largest initial public offering in the world when it was suddenly closed by Beijing 48 hours before the trading would have started in Hong Kong and Shanghai.

While the halt was blamed on the changes occurring in the regulatory environment for the financial technology along with various major issues, analysts comprehended the shock intervention as a warning sign for Ma who had recently criticized regulators during a speech shortly before the IPO.

Source credits: https://www.theguardian.com/business/2020/dec/24/china-targets-alibaba-with-anti-monopoly-investigation

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Saipriya Iyer

Saipriya Iyer

Saipriya Iyer presently works as a content developer for fractovia.org. Having dabbled with the domain of content creation for nearly half a decade, she now boasts of an enviable portfolio, holding substantial experience in penning down pieces related to technology, finance, and a wide spectrum of other industry verticals. A qualified computer engineering graduate from the University of Pune, Saipriya can often be found leveraging her knowledge of software technology and electronics in her write-ups. She can be contacted at- [email protected] | https://twitter.com/saipriya_i

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