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Chinese regulators are investigating tech giant Alibaba into the company’s use of monopoly practices.
China’s State Administration for Market Regulation announced the decision on Thursday.
Regulators had previously warned Alibaba not to force traders to sign monopoly deals that would prevent them from displaying their products on competing platforms.
Regulators will also meet in the coming days with the parent company’s financial technology branch “Antigroup”.
The investigation into monopolistic behavior revolves around the so-called “one in two” practice.
This forces traders to sign monopoly cooperation agreements that prevent them from displaying their products on competing platforms with Alibaba.
Alibaba and Tencent face increased scrutiny from the Chinese government, which is concerned about growing their size and power.
Chinese regulators are concerned about the millions of users drawn to the two companies and their influence on daily life in China, including methods of purchase and payment.
Alibaba, which was founded by Jack May, was already angry with regulators, through coordinated crackdowns on the company.
And forced the company “Ant Group”, which was once called “Alipay” last month, to stop listing it.
Destroy banks
And the regulatory authorities made the decision to stop the initial public offering on the stock exchange a few days ago, after the growing concern of its services related to small loans.
But many believe the real reason behind the move is Mr. Ma’s criticism at the end of October against Chinese regulators and the country’s banking sector.
The billionaire said Chinese banks behave with a “pawnshop” mentality, and some of them claim he is now paying the price for comments he has made in the past.
Since then, tough new antitrust laws have also been passed in the tech industry, causing Alibaba’s market value to drop $ 140 billion, or 17%.
Hunt Company that you are
The People’s Bank of China said in a statement that the meeting with the You group aims to “direct this group towards the implementation of financial supervision, fair competition and the protection of the legitimate rights and interests of consumers.”
After the publication of the regulators’ comments, you said that it “will seriously study the requirements issued by the regulators, strictly implement them and fully comply with all related efforts.”
The Chinese government’s concern has increased due to the growth of parts of the business and its transformation into an empire, especially the lending industry, which generates big profits.
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