Source: US News & World Report.
Chinese government is coming after the country’s tech giants to curb their powers - this time, slamming fines on Alibaba and a Tencent subsidiary for antitrust violations.
China’s antitrust regulators fined Alibaba and China Literature Ltd (the e-book business spun-off by Tencent) for not reporting their past acquisitions for approval. , this suggests a bumpy road ahead for internet giants.
- This follows the new anti-monopoly law, released in November to restrain anti-competitive behaviours in the market.
Why they are fined?
- Alibaba did not seek for approval before it increased its stake in the department store operator Intime Retail Group to 73.79% in 2017;
- ...while China Literature was also censured for its RMB 15.5 deal to buy New Classics Media for filmed media.
The fines have a “symbolic importance” despite the modest amount of penalty (only USD 76k for Alibaba). It signals that China will keep an eye on these tech giants over their monopolistic status. Stocks tumbled at the news… with Alibaba and Tencent shares down over 2.5% at market close.
Time of crisis for tech giants globally?