China’s State Administration for Market Regulation said today it has opened an investigation into Alibaba’s monopolistic practices. The move sent Alibaba’s share price tumbling and put the Chinese e-commerce giant under more pressure from the public sector.
Alibaba shares fell more than 3 percent in after-hours trading. A commentary in the state-run People’s Daily said the survey was conducted to guide the healthy development of the platform’s economy, with the state’s support remaining unchanged.
Official media reports, the people’s bank announced, will be in conjunction with China silver insurance regulatory commission, the China Securities Regulatory Commission and the State Administration of Foreign Exchange, recently questioning alibaba’s ant group, urged guidance group according to the market and government by law principle, the implementation of financial regulation and supervision, fair competition and protect consumers’ legitimate rights and interests, regulating the business operation and development.
Ant Group said that after receiving the notice of interview from the regulatory authorities, it will earnestly study and strictly comply with the requirements of the regulatory authorities to implement relevant work.
After ant group’s ipo was halted last month, “anti-monopoly” became an established policy by mainland authorities to prevent private companies from getting too big in certain sectors.
The State Administration for Market Regulation, in response to a tip-off, investigated Alibaba Group Holding LTD for alleged monopolistic behavior in accordance with the law. The “alternative” means that the online shopping platform requires the e-commerce partners with them not to sell products on other platforms, in a disguised form of exclusive agency.
The People’s Daily published a signed article saying that the action is an important measure to strengthen anti-monopoly supervision in the Internet sector. The investigation does not mean a change in China’s attitude towards encouraging and supporting platform economy, but is aimed at better regulating and developing platform economy and guiding and promoting the healthy development of the industry.
The move shows how Chinese authorities are stepping up pressure on Alibaba, one of the country’s most influential companies. Alibaba has revolutionized the landscape of E-commerce in China, turning founder Jack Ma into the country’s richest man.
Alibaba’s shares fell 5.48% at the opening of trading on the Hong Kong Stock Exchange this morning after the official announcement.
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