China launches anti-monopoly investigation into Alibaba Group. In addition to Alibaba, regulators oversee Ant Group, another company Jack Ma Is included. In fact, Chinese lawmakers have summoned Antgroup in the latest regulatory action to take more control of Internet companies. On December 24 of this year, the Chinese market regulator announced in a statement that it has launched an investigation into the e-commerce giant:
Alibaba’s “choose one of two” policies force merchants to sell their products only on Alibaba and avoid providing services on competing platforms, including JD.com and Pinduoduo.
The start of the Alibaba monopoly is one of the latest efforts by Chinese lawmakers to control the power of the country’s technology giants. In November of this year, the China Regulatory Authority drafted laws restricting corporate data collection activities and other consumer protection laws.
According to the South China Morning Post, the Chinese regulator has summoned JD.com, Meituan, Tencent, Pinduoduo and Didi Chuxing in addition to Alibaba for Tuesday’s meeting to discuss the nine laws they are required to follow. According to the regulator, these tech giants should not sell their products below normal prices in order to overtake competitors or gain market monopoly.
On Thursday, Alibaba said in a statement about the recent move by Chinese regulators:
Based on the warning received by Alibaba Group from this institution, an investigation has been launched to verify the compliance of the company’s activities with anti-monopoly laws. In this review, Alibaba will work with regulators. The business of this company is going on as in the past.
Alibaba’s share on the Hong Kong Stock Exchange fell more than 8% last Thursday after regulators began investigating, and shares of other Chinese tech companies fell.
According to Chinese media reports in Xinhua, a group of financial lawmakers summoned Ant Group on Thursday to explain its activities. Antip Group manages the popular Alipi wallet and acts as an intermediary for financial services and customers. Last month, after Chinese officials suspended its initial public offering, Ant Group pledged to continue to operate on set principles to reduce lending risk.
According to the Wall Street Journal, Chinese lawmakers have halted Ant Group’s $ 34 billion initial public offering. Jack Ma, The founder of Alibaba, has established Ant Group as the company’s digital payment service.
“Today, Ant Group received an announcement to meet with regulators,” Ant Group said in a statement on Thursday. “We are seriously studying and complying with all legal requirements and making every effort to take the necessary steps.”
China regulators are finally taking the necessary steps to control more of China’s Internet giants. It is worth mentioning that these companies have been able to grow well in a not so strict regulatory environment. According to China’s state-run newspaper, Alibaba’s recent case is an important step in the country’s anti-monopoly regulation of the Internet industry. Research on Alibaba is also said to be beneficial for the long-term development of the platform economy.
In addition to Alibaba, antitrust investigations target tech giants Google and Facebook. For the third time this year, Google has been accused of violating antitrust laws, and another lawsuit is likely to be filed against the company in early 2021. The Federal Trade Commission has filed an anti-monopoly case against Facebook, accusing the company of anti-competitive behavior for buying WhatsApp and Instagram.