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SHANGHAI/HONG KONG (Reuters) -China slapped a record 18 billion
yuan ($2.75 billion) fine on Alibaba Group Holding Ltd on
Saturday, after an anti-monopoly probe found the e-commerce
giant had abused its dominant market position for several years.

The fine, about 4% of Alibaba’s 2019 domestic revenues, comes
amid a crackdown on technology conglomerates and indicates
China’s antitrust enforcement on internet platforms has entered
a new era after years of laissez-faire approach.

The Alibaba business empire has come under intense scrutiny in
China since billionaire founder Jack Ma’s stinging public
criticism of the country’s regulatory system in October.

A month later, authorities scuttled a planned $37 billion IPO by
Ant Group, Alibaba’s internet finance arm, which was set to be
the world’s biggest ever. The State Administration for Market
Regulation (SAMR) announced its antitrust probe into the company
in December.

While the fine brings Alibaba a step closer to resolving its
antitrust woes, Ant still needs to agree to a regulatory-driven
revamp that is expected to sharply cut its valuations and rein
in some of its freewheeling businesses.

“This penalty will be viewed as a closure to the anti-monopoly
case for now by the market. It’s indeed the highest profile anti-
monopoly case in China,” said Hong Hao, head of research BOCOM
International in Hong Kong.

“The market has been anticipating some sort of penalty for some
time ... but people need to pay attention to the measures beyond
the anti-monopoly investigation.”

The SAMR said it had determined that Alibaba, which is listed in
New York and Hong Kong, had been “abusing market dominance”
since 2015 by preventing its merchants from using other online e-
commerce platforms.

The practice, which the SAMR has previously spelt out as
illegal, violates China’s antimonopoly law by hindering the free
circulation of goods and infringing on the business interests of
merchants, the regulator added.

https://www.reuters.com/article/us-china-alibaba-idINKBN2BX015
 

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