Chinese officials slapped Alibaba with a $ 2.8 billion fine after completing an antitrust investigation that looked into alleged monopoly practices. State administration for market regulation launched a probe in the e-commerce giant’s “alleged monopoly behavior” in December, including its policy that requires merchants to sell exclusively on its platforms and prevents them from selling on competing e-commerce sites. In a version posted On the watchdog’s website, he said his investigation had proven that the policy was eliminating and limiting competition in the country and hampering innovation in the online retail platform industry.
Following this finding, the regulator sanctioned the company in accordance with China’s antimonopoly law, ordering it to end its illegal activities and pay a fine equivalent to 4% of its domestic sales in the country. As The New York Times note, the $ 2.8 billion fine will not put Alibaba’s finances at risk, but it exceeds the $ 975 million penalty imposed by the Chinese government imposed on Qualcomm in 2015 for breaking the antimonopoly law. In a statement sent to NOW, Alibaba said it would accept the sanction and make sure it “better discharges its social responsibilities.”
China began to monitor tech giants more closely last year, with lawmakers proposing an update to the antimonopoly law to add rules specifically for them. Jack Ma’s businesses, in particular, appear to have become a target in his home country after calling Chinese banks “state pawn shops” for making unnecessary loans at a finance summit. Its leaders even had to form a working group to deal with regulators on a daily basis.
In addition to the antimonopoly investigation into Alibaba, the Shanghai Stock Exchange blocked the planned IPO for Ant Group, the financial services company he founded, in November. Before the end of the year, regulators ordered the business to “go back to its origins” as a payment provider and shut down the investment, lending, insurance and wealth management services it has established over the years.