Alibaba has accomplished a three-year regulatory “rectification process” after being fined for antitrust violations in 2021 for monopolistic practices, China’s market regulator said on Friday.
Alibaba shares rose nearly 3 percent in trading on Friday.
On Friday, China's State Administration for Market Regulation (SAMR) said it had been monitoring Alibaba's strategy of complying with antitrust rules over the past few years. The corrective measures had achieved “good results,” said an announcement from the SAMR translated by Google.
In 2021, China's SAMR fined the tech giant 18.23 billion yuan ($2.6 billion) as a part of an anti-monopoly investigation. The regulator's focus was on a practice that forces merchants to decide on considered one of two e-commerce platforms as a substitute of having the ability to work with each.
At the time, the regulator said that Alibaba's “Choose One” policy and other measures had enabled it to strengthen its position available in the market and gain unfair competitive benefits.
Since this superb, the SAMR has been monitoring Alibaba's compliance with the regulator's requirements. Alibaba has now accomplished this process and stopped the “choose one out of two monopoly behavior,” the SAMR said on Friday.
SAMR said it could now support Alibaba in further improving its compliance and efficiency and driving innovation.
Completion of regulatory reform will help put considered one of Alibaba's worst clashes with Beijing behind it. Analysts at Jefferies said in a note on Friday that the completion of the regulatory process was “positive” for the corporate because it “underscores that this is a fresh start and ensures compliance in operations.”
But the regulator's announcement may be an indication that the Chinese government is further loosening its stance on private technology corporations after its intense crackdown on private technology corporations. The country had already cracked down on these corporations in late 2020, when Beijing issued quite a few regulations and measures geared toward limiting the ability of domestic technology corporations in areas comparable to antitrust and gambling.
Alibaba founder Jack Ma's empire has been within the highlight in recent times since regulators blocked the IPO of his financial technology company Ant Group in 2020. Ant Group itself also went through a regulator-supervised turnaround process, with most major issues resolved by last 12 months.
Regulatory concerns have weighed heavily on Alibaba's stock, which has fallen greater than 70% since its 2020 peak. Recently, the corporate has struggled with slow growth amid increasing competition in China's e-commerce space, in addition to cautious Chinese consumers.
The technology giant showed early signs of recovery within the June quarter as cloud computing revenues picked up and transactions through its e-commerce platforms appeared healthy.
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