Alibaba’s office building is seen in Nanjing, Jiangsu province, China, 28 August 2024.
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Alibaba has completed a three-year regulatory “correction” process following an antitrust fine it received on allegations of monopolistic practices in 2021, China’s market regulator said on Friday.
Alibaba shares rose nearly 3% in afternoon trading Friday.
On Friday, China’s State Administration for Market Regulation, or SAMR, said it had, over the past several years, been monitoring Alibaba’s process of becoming compliant with antitrust regulations. The corrective work has achieved “good results,” SAMR said, according to a Google-translated statement.
In 2021, China’s SAMR fined Alibaba 18.23 billion yuan ($2.6 billion) as part of an anti-monopoly investigation into the tech giant. The regulator’s focus is on practices that force merchants to choose one of two e-commerce platforms, rather than being able to work with both.
At the time, regulators said the “pick one” policy and others allowed Alibaba to strengthen its position in the market and gain an unfair competitive advantage.
Since the fine, SAMR has been monitoring Alibaba as it complies with the regulator’s requirements. Alibaba has now completed this process and has ended the “choose one of the two” monopoly behavior,” Samr said on Friday.
SAMR said it will now guide Alibaba to continue to improve compliance and efficiency and accelerate innovation.
The conclusion of the regulatory review will help make one of Alibaba’s worst run-ins with Beijing behind it. Analyst Jefferies said in a note on Friday that the conclusion of the regulatory process was “positive” for the company, which “highlights this new beginning and ensures compliance in operations.”
But the regulator’s announcement could also signal a continued softening of China’s regulators toward private tech companies, following a crackdown that began in late 2020. In that time, Beijing has implemented a number of regulations and moves aimed at limiting domestic tech power. . companies in areas ranging from antitrust to games.
Alibaba founder Jack Ma’s empire has been in the spotlight for the past few years since regulators blocked the IPO of financial technology company Ant Group in 2020. Ant Group itself is also undergoing a correction process overseen by regulators, with many major problems. solved last year.
Regulatory concerns have been an overhang on Alibaba’s stock, which has fallen more than 70% from its peak in 2020. Most recently, the company has seen slow growth amid growing competition in the e-commerce space in China, as well as a tussle with consumers Careful Chinese.
The tech titan showed early signs of recovery in the June quarter, as cloud computing revenue accelerated and transactions through e-commerce platforms appeared healthy.
— CNBC’s Christine Wang contributed to this report.
