China imposes record $ 2.75 billion fine on Alibaba for monopolistic practices
After months of friction, Alibaba, the e-commerce giant founded by Jack Ma, will have to pay the highest fine in China's corporate history.
For a few months, the Chinese government seems to have launched a campaign against Alibaba , which reached a new climax. This Saturday, April 10, the company founded by Jack Ma received a record fine of 2.75 billion dollars . This after determining that, indeed, it would have engaged in monopolistic practices taking advantage of its dominant position as an electronic commerce giant.
Last December, China's State Administration for Market Regulation (SAMR) announced in a statement that it was investigating Alibaba Group Holding Ltd. on "suspicion of monopolistic conduct ." The consortium allegedly violated the country's antitrust law by preventing merchants from selling their products on other shopping platforms.
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This Saturday, the regulator reported that they concluded that Alibaba's exclusionary practices had hindered competition in online retail, affecting innovation in the online economy and damaging the interests of consumers, reports The New York Times .
Thus, China imposed an economic sanction on Alibaba for 2.75 billion dollars , a figure much higher than the 975 million dollars that Qualcomm Inc. paid in 2015 for anti-competitive practices, which until now had been the highest fine in corporate history of the Asian country .
The problems between Alibaba and the government of China
The drama between Alibaba Group Holding Ltd. and the Chinese authorities began in October 2020 . During an event in Shanghai, Jack Ma made a series of criticisms against the banking system and regulators in his country. Since then, the consortium has come under heavy government scrutiny.
I am honored to partner with HRH The Duke of Cambridge @KensingtonRoyal & other global leaders and organizations to support the @EarthshotPrize and tackle the environmental challenges we all face. Together, we can protect our planet from climate change! https://t.co/0ax1imIZMC pic.twitter.com/EN6yissNGI- Jack Ma (@JackMa) October 10, 2020
A month later, the authorities of the Asian country stopped the listing of Ant Group , the financial arm of Alibaba and parent of Alipay , its online payments division, from the stock market.
The antitrust investigation was announced in December, causing a 9% drop in the company's stock and losses of more than $ 100 billion .
At the beginning of this 2021, a controversy was unleashed by the apparent disappearance of Jack Ma , since since those statements he had no public presentations. He has also not posted anything on his Twitter profile since October 10, 2020, when he announced his participation in the event.
The tycoon behind the consortium reappeared in late January, briefly participating in a virtual meeting with rural teachers.
In mid-March it emerged that the Chinese government asked Alibaba to ditch its shares in the media . This includes assets on the Weibo platform, similar to Twitter, and the South China Morning Post , an English-language newspaper distributed in Hong Kong, among other publications. According to The Wall Street Journal , officials are concerned about the influence of the consortium on public opinion in the Asian country.