Not long ago, China’s four major regulators conducted a joint regulatory interview with Ant Group’s top executives three days before the company’s IPO and called an emergency halt to the listing. The relevant parties recently “wielded the knife” at Ant again, interviewing the group and putting forward Ant’s four major problems and five major rectification requirements.
The People’s Bank of China (PBOC) issued a notice on December 24, saying that the bank, together with the China Banking and Insurance Regulatory Commission (CBIRC), China Securities Regulatory Commission (CSRC) and State Administration of Foreign Exchange (SAFE), interviewed Ant Group for the second time. Pan Gongsheng, deputy governor of the People’s Bank of China, responded to media questions on behalf of the four departments on the interview on the 26th, disclosing that Ant had unsound governance mechanisms, illegal regulatory arbitrage, use of dominant market position to exclude peer operators, and damage to the legitimate rights and interests of consumers.
Ant has four problems, to five rectification?
In an interview with our reporter, Wang Jian, a senior economic media personality in the United States, described the Chinese official’s accusations against Ant as unreasonable, arguing that the authorities were merely looking for excuses and “showing off their muscles.
“Ant and Alibaba are very big companies, they will have compliance departments, that is, specializing in government laws and regulations, and now (the authorities) say they are driving without a license? Another interview is to caution the world, such a large company I have to whole, others are honest.”
At the same time, Pan Gongsheng also said that the central government has recently made a series of important deployments to strengthen anti-monopoly and prevent disorderly expansion of capital, Ant Group must integrate corporate development into the overall national development, and effectively assume corporate social responsibility, requiring Ant to carry out five rectification, including the return to the origin of payment; legal and compliant operation of personal credit business; the establishment of a financial holding company in accordance with the law; rectification of illegal credit, insurance, wealth management and other financial activities; there is also compliance with the securities fund business.
Wang Jian told reporters that in recent years, Internet capital has been infiltrating traditional industries, moving the “cheese” of the Chinese government, which led to Ant being the focus of “attention” by the Chinese government.
“Now China’s Internet capital like Tencent, Alibaba, Jingdong, they have the advantages of capital, technology, management, market, when he penetrated the traditional industry, encountered the government’s ‘biological son’ state-owned enterprises. Then the government must step in and crack down on Ma, Ali, to warn these Internet capital, you can only keep in your Internet field, do not expand to the traditional field, or you will become the next Ma Yun.”
Authorities lose patience with Jack Ma?
Chinese officials have recently been “taking shots” at China’s Internet giants and have turned their guns on Alibaba and Ant Group, causing Jack Ma, founder of Alibaba and the de facto controller of Ant Group, to experience a painful fall from his high horse in just two months.
Earlier reports in the New York Times and Bloomberg mentioned that Chinese officials have long been alerted to the Internet giant’s growing threat to the authorities’ most valued political and financial stability, and have also long lost patience with Ma for daring to challenge authority.
Some analysts say that under the banner of “safeguarding public interests,” Beijing authorities are in fact using political tactics to silence the owners of leading companies and private firms, demanding that they “listen to the Party and follow it.
And just after Ant’s IPO fell through, Chinese President Xi Jinping released a clear political message that his ideal capitalist should put national interests ahead of business interests by visiting a museum featuring Zhang Jian, an industrialist from the early Qing Dynasty.
According to U.S.-based political and economic analyst Qin Peng, the trigger for the Ant’s “targeting” was Ma’s comments at a financial summit in October this year.
“At that time (Ma) criticized China’s financial regulation in a mess. This is a very sensitive nerve (authorities), financial stability can be directly said to affect the people in power can not sit stable problem.”
Private companies to be “nationalized”?
To add insult to injury, China’s State Administration of Market Supervision earlier issued the first anti-monopoly fines against three companies, including Alibaba, and then announced a case to investigate Alibaba’s alleged monopoly on the same day it interviewed Ant again.
According to the news from the financial sector, the central government intends to “dismember” Alibaba and Ant, splitting all independent businesses into new independent companies, with Ali and Ant retaining a controlling stake in each business company, but having to open up each business to state-owned enterprises. The Internet giants will be completely “nationalized” by the government in the name of “anti-monopoly”.
The New York Times also reported that China’s biggest domestic monopolies are not technology companies, but state-owned companies that dominate banking, finance, telecommunications, electricity and other basic industries.
A Sina.com user commented, “Of all the types of monopolies, it is only the forced restriction of market access that really hinders technological progress and economic efficiency. In fact, the real exploitation comes from power, not capital”.
Qin Peng also said that if the state capital into Alibaba or Ant, although it may only account for a very small part, “the Chinese government has a say, because if you move state assets, you will be branded as embezzling state assets, and occupy a seat on the board of directors, for further regulation in different areas, a lot of things can be done.”
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