“aSeating on information, China State Administration for Market Regulation [SAMR] The investigation has begun [into] Alibaba Group for Monopoly Conduct, including Enforcement of ‘Exclusive Dealing Agreement’. This short note, posted on December 24 by the state news agency, Xinhua, seemed to be about the size of China’s most powerful online online Titan. The announcement three days later of an additional b6bn in share buy-back also did not capture the slide in its market price. By December 28 it was down 13%, or b 91bn. By comparison, U.S. regulators have in recent weeks issued detailed chargesheets against tech giants such as Facebook and Google from investors.
The Alibaba probe is the first of its kind in Chinese e-commerce. Its time – a month later the authorities abruptly stopped the initial public announcement of b 37bn (IPO) Alibaba’s fintech affiliate, Ant Group, and regulators have told Ant to cut back on lending and asset-management activities, a sign of the days ahead – it’s China’s way of disciplining Jack Ma, a brilliant co-founder of the two companies.
It could be. Of ants IPO Mr. Mae was put on ice after comparing state banks in China to pawn shops. Angela Zhang of the University of Hong Kong says Chinese watchers often use lightning strikes to prevent others from abusing them. But the probe economy also hints at concerns over the online economy, which is hilarious but also more focused. When investors analyzed the Xinhua note, the prices of other internet giants, such as Tencent and Matuan, almost dropped compared to Alibaba.
Complaint against Alibaba Centers on the practice of signing contracts of merchants or brands to sell products on its platform. Those who do business in rival markets take the risk of Internet traffic being diverted from their online online shopfront on Alibaba’s Tmal Amp or Riyam to other sellers.
Such an arrangement is not new. In 2015 JD.com, a small e-emporium backed by Tencent, filed a lawsuit against Alibaba over the same issue. Nor is it specific to Mr. Manny’s firm, which launched a rival complaint against him J.D..com same year. These and other complaints have since been largely ignored by regulators. Why rotate?
Chinese trustbusters have long resisted blocking the industry, which has been seen as beating the world, and backed in Beijing. Now, like the West, they are concerned that a few giants control essential services – e-commerce, logistics, payments, ride-hauling, food delivery, social media, messaging. Common practices, such as selling products below prices to attract customers, get into more trouble in an industry where the top three companies control more than 90% of the market. In November SAMR That said, offering customers different prices based on their spending power, separated by user data, could be illegal.
Another reason for China’s new zeal (putting Mr. Mana Jibes aside) is its more credible potential. SAMR Combined with the offices of just three regulators, it was created in 2018 alone. It still struggles to keep up with the rapidly changing online online marketplace; Most staff are busy evaluating mergers and acquisitions. But it has more knowledge and manpower than ever before – and looks forward to deploying them.
This article appeared in the Business section of the print edition under the heading “Money, Money Problems”
