China launches monoply probe into Alibaba

(24 Dec 2020) Chinese regulators on Thursday announced an anti-monopoly investigation of e-commerce giant Alibaba Group, stepping up the ruling Communist Party's efforts to control fast-growing tech industries.
President Xi Jinping's government promotes e-commerce, social media and other online industries but worries about Alibaba and other dominant competitors.
The Communist Party says anti-monopoly enforcement, especially in tech industries, will be a priority next year.
Proposed rules issued in November would ban exclusive contracts, subsidies and other tactics regulators say hurt competition.
Alibaba, set up in 1999, operates retail, business-to-business and consumer-to-consumer platforms.
It is the world's biggest e-commerce company by sales volume and has expanded into financial services, film production and other fields.
The company has innovated people's way of life in China, but its dominance has also drawn attention from the authorities.
"They are taking business like deposit and loans away from the big segment, commercial banks. And all these internet companies are privately owned. And you are threatening the survival of the state owned commercial banks," said Francis Lun, Chief Executive Officer at Geo Securities Limited.
Alibaba's founder, Jack Ma, is China's richest entrepreneur with a net worth of $59 billion (USD).
He is widely admired and a Communist Party member but has run into regulatory hurdles.
In November, regulators jolted the Chinese business world by suspending the stock market debut of Ant Group, a former Alibaba subsidiary that is the world's biggest online finance platform.
It would have been the top global initial public offering this year.  
Economists said regulators worried about financial risks, but analysts said political concerns were also behind the move.
"They have access to hundreds of millions of people. And the government has no control, virtually no control over it. They actually threaten the rule, direct rule of the Chinese Communist Party," said Francis Lun, Chief Executive Officer, Geo Securities Limited.
Ma stepped down as Alibaba chair in 2019 but still is one of its biggest shareholders and played a leading role in taking Ant to market.

Find out more about AP Archive: http://www.aparchive.com/HowWeWork
Twitter: https://twitter.com/AP_Archive
Facebook: https://www.facebook.com/APArchives
Google+: https://plus.google.com/b/102011028589719587178/+APArchive​
Tumblr: https://aparchives.tumblr.com/​​
Instagram: https://www.instagram.com/APNews/


You can license this story through AP Archive: http://www.aparchive.com/metadata/youtube/71eaeab2de7148f69eb50d969a08b71f