Home StocksAsia Massive Fine for Alibaba?

Massive Fine for Alibaba?

by S. Jack Heffernan Ph.D

China is considering imposing a record fine of nearly US$1 billion on e-commerce giant Alibaba for allegedly flouting monopoly rules, according to a report, as authorities continue to put the screws on the firm as part of a crackdown on the technology sector.

The penalty could top the $975 million paid by US chipmaker Qualcomm in 2015 – the biggest known for anticompetitive practices in China – the Wall Street Journal report said, citing unnamed ‘people with knowledge of the matter.’

Antitrust regulators in charge of Alibaba’s case did not immediately respond to queries on the report, which was published by the Journal late Thursday.

The company, China’s largest online shopping portal, has been in the crosshairs of authorities in recent months over concerns of its reach into the daily finances of ordinary Chinese people.

But its legal troubles began after comments in October last year by billionaire founder Jack Ma in which he laid into China’s convoluted regulatory system.

In November, financial regulators pulled the plug on the record $35 billion Hong Kong-Shanghai initial public offering of Alibaba’s online payment subsidiary Ant Group.

A month later, officials opened an investigation into Alibaba’s business practices, deemed anti-competitive, and Ma disappeared from public view until mid-January.

The company based in the eastern city of Hangzhou said it was ‘fully cooperating’ with the investigation by the State Administration for Market Regulation last month.

Regulators are also investigating whether the conglomerate should divest assets unrelated to its main online retail business, the Journal reported without offering details. 

An Alibaba spokesperson declined to comment on the report.

The company has come under fire in the past for allegedly forbidding its merchants from listing on rival e-commerce platforms.

Once finalized, measures against Alibaba will need to be approved by China’s top leadership.

The squeeze on one of China’s most influential companies is the latest sign that the leadership is ready to deflate the ambitions of big tech firms in a runaway internet sector.

You may also like

logo-white

Your Trusted Source for Capital Markets & Related News

© 2024 LiveTradingNews.com – For The Traders, By The Traders – All Right Reserved.

The information contained on this website shall not be construed as (i) an offer to purchase or sell, or the solicitation of an offer to purchase or sell, any securities or services, (ii) investment, legal, business or tax advice or an offer to provide such advice, or (iii) a basis for making any investment decision. An offering may only be made upon a qualified investor’s receipt not via this website of formal materials from the Knightsbridge an offering memorandum and subscription documentation (“offering materials”). In the case of any inconsistency between the information on this website and any such offering materials, the offering materials shall control. Securities shall not be offered or sold in any jurisdiction in which such offer or sale would be unlawful unless the requirements of the applicable laws of such jurisdiction have been satisfied. Any decision to invest in securities must be based solely upon the information set forth in the applicable offering materials, which should be read carefully by qualified investors prior to investing. An investment with Knightsbridge is not suitable or desirable for all investors; investors may lose all or a portion of the capital invested. Investors may be required to bear the financial risks of an investment for an indefinite period of time. Qualified investors are urged to consult with their own legal, financial and tax advisors before making any investment. Knightsbridge is a private investment firm that offers investment services to Qualified Investors, Members and Institutions ONLY. Qualified Investors are defined as individuals who have met those Qualifications in the relevant jurisdictions. Members are defined as individuals who have been accepted into the Knightsbridge membership program. Institutions are defined as entities such as banks, pension funds, and hedge funds. If you are not a Qualified Investor, Member or Institution, you are not eligible to invest with Knightsbridge. All investments involve risk, and there is no guarantee of profit. You may lose some or all of your investment. Past performance is not indicative of future results. Knightsbridge is not a registered investment advisor, and this disclaimer should not be construed as investment advice. Please consult with a qualified financial advisor before making any investment decisions. By accessing this website, you agree to the terms of this disclaimer. Thank you for your interest in Knightsbridge.