Beijing deals another blow to Alibaba’s Jack Ma in whopping fine of 2.3 billion
The Chinese online trading giant is accused of violating anti-monopoly rules. Antitrust Authority: The company damages competition and consumers. Xi Jinping has long had the billionaire in his sights. The regime wants to limit the influence of large corporations.
Beijing (AsiaNews) - The Chinese giant Alibaba will have to pay a fine of 18.2 billion yuan (2.3 billion euros) for abusing its dominant position in the online commerce sector. The State Administration for Market Regulation made the announcement this morning at the conclusion of an investigation launched in December.
The multinational founded by billionaire Jack Ma is accused of requiring retailers who want to use its web platforms not to turn to competing companies. According to the Chinese authorities, this harms competition and violates the consumer interests.
State television CCTV reports that on March 15, Chinese President Xi Jinping ordered the competent authorities to control the activity of the internet giants, putting an end to monopolies in the sector and promoting "fair competition". Last December the government declared that the launch of an anti-trust policy will be one of the economic priorities for 2021.
Alibaba released a statement declaring that it "accepts" the punishment. The fine is the highest ever imposed on a company operating in China: in 2015, the microchip manufacturer Qualcomm had to pay € 840 million. On March 12, the authorities had already fined 12 major hi-tech companies, including Tencent, Baidu, Didi Chuxing and SoftBank, for violating anti-monopoly rules. After the announcement, the Tencent stock lost € 52 billion on the stock market.
The creature founded by Jack Ma has long been in the sights of the regime. In November, the government blocked the stock exchange listing of Ant Group the financial arm of Alibaba. The listing, the highest in history (33.7 billion euros), was stopped because Ant's activity was not in line with the new government rules on the granting of micro-financing through web platforms. A month later, authorities fined Alibaba and Tencent for failing to disclose deals with which they acquired smaller competitors.
Many observers believe Ma's public attack on October 24 on the country's financial and banking system is to blame. Since then, the Chinese tycoon has kept a low profile, limiting public releases. Simon Hu, managing director of Ant, resigned on March 12. He had wanted to transform Alipay, the company's main asset, into a large "online shopping mall" capable of providing loans, tourist services and ensuring home deliveries. Like Jack Ma, Hu will now devote himself to "charity": the refuge for those who upset Xi.
Analysts point out that the technology market in China is in fact poorly regulated: companies like Alibaba can therefore abuse their dominant position. In order to foster technological innovation, for years the Chinese authorities have given a free hand to the hi-tech giants, now it will be difficult to regulate the sector.
Experts concur that Xi's primary objective is to limit the influence of large corporations, which represent a potential threat to the power of the Chinese Communist Party. According to the Financial Times, the government's decision to block new enrolments at the elite academy created by Jack Ma in Hangzhou (Zhejiang), his hometown, is a clue to this effect. The Hupan University - writes the British newspaper – is guilty of nurturing a generation of entrepreneurs aligned with Ma's thinking and not with that of the Party.