China issues warning to tech firms after record Alibaba fine
Chinese authorities have issued a stark ultimatum to more than three dozen tech companies, warning them to stop engaging in any practices that fall foul of new regulations.
The country’s market regulator, which last week slapped Alibaba with a $2.8bn fine, said it summoned 34 companies including Tencent, JD.com and Tiktok owner Bytedance.
The State Administration for Market Regulation (SAMR) ordered them to carry out reviews into their businesses within a month, warning of “severe punishment” for any who broke the rules.
China issued new anti-monopoly guidelines in February as part of a wider effort to curb the ballooning power of tech giants in the country.
The SAMR handed the record fine to Alibaba on Saturday and warned other companies to learn from that lesson.
Among the practices under scrutiny by authorities are forcing vendors to operate on only one platform and abusive practices in community group buying, a popular ecommerce trend in China.
Regulators have also forced Ant Group, part of Jack Ma’s sprawling Alibaba empire, to restructure as a financial holding company after blocking its initial public offering last year.
The float, which would have valued Ant Group at roughly $37bn, would have been the world’s largest.
Officials cited concerns about links between the company’s tech business and financial services offering.
In a statement on its website the SAMR said the overall state of China’s platform economy was improving, but insisted no time should be wasted in ensuring firms complied with the law.
Other companies summoned to the meeting included search giant Baidu and food delivery platform Meituan.