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Chinese internet companies face antitrust fines for the first time
Calls to limit the degree of influence on the market of Internet companies are heard in many countries. The corresponding additions to the legislative acts are being prepared by the authorities of the United States and Europe, Japan and China are eyeing them. A precedent was set in the Celestial Empire: for the first time, three companies in the Internet sector faced antitrust fines.
Image source: Reuters
As noted by CNBC, the Internet-commerce giant Alibaba, the Tencent-backed company China Literature and Hive Box Technology were “guilty”. China’s State Administration for Market Regulation (SAMR) has ruled that all three companies must pay the government $ 76,463 for not fully declaring their past transactions. The regulator claims that the companies violated the 2021 law aimed at combating abuse of monopoly position in the market. Government-reviewed transactions of listed companies took place between 2021 and 20221.
The amount of fines is not so great, but for the participants in the Chinese Internet market, they should be a signal for a more thorough declaration of transactions that may come to the attention of local antitrust authorities. The authorities have the right to terminate transactions that may contradict the antitrust laws of the PRC. Over the past ten years, Chinese companies have closed 8,702 deals totaling $ 507 billion, according to Refinitiv. In theory, each of them could attract the attention of the antitrust authorities in China. According to third-party experts, the PRC Internet market has developed rapidly over the past twelve years without any special restrictions on the part of anti-monopoly authorities, but now they make it clear that this time has passed.