China strengthens antitrust law, shoots Alibaba, Tencent, etc.

by Stock Catalog

On February 7, 2021, local time, the Chinese government tightened antitrust laws. The newly enacted guidelines clearly state that the act of asking business partners not to do business with rival companies is prohibited, such as e-commerce systems such as Taobao operated by Alibaba and Alipay of Alibaba.・ It is believed that this is an enhancement with payment services such as Tencent's WeChat Pay in mind.

China issues new anti-monopoly rules targeting its tech giants | Reuters
https://www.reuters.com/article/us-china-internet-anti-monopoly-idUSKBN2A70DT

The newly enacted guidelines clarify the antitrust bill announced in November 2020, and the act of 'requiring business partners not to do business with rival companies', which has been customary in China's e-commerce platform, , Price fixing such as selling at a significantly lower price than rival companies or raising the price on the contrary is prohibited. In addition, technical restrictions by companies and market manipulation by data and algorithms are also prohibited.

This strengthening of the Antimonopoly Act includes a case in which Alibaba urged its business partners to choose between platforms in December 2020 and forced them to conclude an exclusive cooperation contract, and JD under Alibaba and Tencent. It is believed that the cause was a case in which .com was doing an illegal act of 'raising the price the day before and then discounting it as a sale'.

Chinese authorities start investigating IT giant Alibaba on suspicion of monopoly --GIGAZINE

Regulators have commented on the move, 'We will suspend monopoly action in the platform economy and protect fair competition in the market.'