An Alibaba office building in Nanjing, Jiangsu Province, China, August 28, 2024.
CFOTO | Future Publishing | Getty Images
Alibaba China’s markets regulator said on Friday it had completed a three-year regulatory “rectification” process after being hit with antitrust fines in 2021 for alleged monopolistic practices.
Alibaba shares rose about 3% in trading on Friday.
China’s State Administration for Market Regulation (SAMR) said on Friday that it has been overseeing Alibaba’s process to comply with antitrust laws over the past few years. In a statement translated by Google, SAMR said the remedial work had achieved “good results.”
In 2021, China’s SAMR fined tech giant Alibaba 18.23 billion yuan ($2.6 billion) as part of an antitrust investigation into the company. The regulator’s focus was on the practice of forcing retailers to choose one or the other e-commerce platform rather than allowing them to use both.
At the time, regulators said the “choose one” policy and other policies had allowed Alibaba to strengthen its market position and gain an unfair competitive advantage.
Since the fine, SAMR has been monitoring Alibaba to ensure it complies with regulators’ requirements, a process that has now been completed, with Alibaba “ending its ‘choose one of two’ monopoly practices,” SAMR announced on Friday.
SAMR said it will continue to guide Alibaba to improve compliance and efficiency, and accelerate innovation.
Completing the regulatory reforms will help Alibaba put one of its worst clashes with Beijing behind it. Analysts at Jefferies said in a note on Friday that the completion of the regulatory process is a “positive” for the company, “underscoring that this is a fresh start and ensuring compliance of operations.”
But the regulator’s announcement could also signal a softening of China’s regulatory stance toward private technology companies following a tough crackdown that began in late 2020. Back then, Beijing enacted several regulations and measures aimed at limiting the power of domestic technology companies in areas ranging from antitrust to gaming.
Alibaba founder Jack Ma’s empire has been in the spotlight in recent years since regulators halted the IPO of his financial technology company Ant Group in 2020. Ant Group itself underwent a remediation process overseen by regulators, with most of its major issues resolved by last year.
Regulatory concerns have weighed on Alibaba shares, which have fallen more than 70% from their 2020 peak. The company has struggled recently with slowing growth due to increased competition in China’s e-commerce sector and catering to wary Chinese consumers.
The technology giant showed signs of recovery in the June quarter as cloud-computing revenue accelerated again and trading through its e-commerce platform looked healthy.
— CNBC’s Christine Wang contributed to this report.
