China Hits Alibaba With $2.78 Billion Fine Following Investigation
CHINA HITS ALIBABA WITH FINE – Chinese Regulators fined Alibaba $2.78 Billion for “abusing their position”.
According to China’s state-run media Xinhua News, Alibaba required merchants to exclusively sell their products on their platform. With this, Alibaba could possibly cut off competition from other e-commerce sites.
Regulators said they concluded investigations which started back in December of 2020. Furthermore, they decided to fine the company for 4% of its 2019 sales of 455.7 billion Yuan.
However, Alibaba and several other e-commerce giants have gone under scrutiny by the Chinese government since last October. The reason for this was Jack Ma’s criticism of Chinese regulators being “behind the times”.
Previously, these regulators expressed concern as Alibaba was shifting toward loans, wealth management, and insurance through their financial arm, Ant Group. As such, China viewed Ma’s plans with his financial arm as a challenge to their authority.
For the longest time, Jack Ma held the title for China’s richest man. However, after heavy scrutiny from Chinese Regulators, he became fourth.
With the Ant Group’s platform for lending and insurance, it takes away the Chinese government’s regulatory powers. As such, some officials wanted Ma to fold some of its businesses into a financial holding company that could be centralized much like traditional firms.
This caused Jack Ma to speak out against the Chinese Regulators causing the scuffle between the government and his companies. Still, even with this bump, Jack Ma ranks 26th in the running for World’s Richest.
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