Ant Group and Others Engage in Monopoly Conduct, But “Regulatory Discussions” Will Not Affect Normal Development: CBIRC

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The Chinese banking regulator has sought to reassure the broader market that China’s business environment for private enterprises will not be adversely affected by recent anti-trust measures targeting domestic Internet platforms such as Jack Ma’s Ant Group.

“Recently, financial authorities have held regulatory discussions with a number of Internet platform enterprises such as Ant Group, to highlight the innovation role they play with regard to the development of fintech, raising the efficiency of financial services and financial inclusion” said Liang Tao (梁涛), deputy-chair of the China Banking and Insurance Regulatory Commission (CBIRC), at a press conference held on 22 January.

“However, [CBIRC] also pointed out that they suffer from problems including regulatory arbitrage in breach of rules, monopoly business operation, and harm to the lawful rights and interests of consumers.

“Financial regulatory authorities have adopted standardisation measures in accordance with the basic requirements for strengthening anti-trust efforts and preventing the disorderly expansion of capital.

“Of course, relevant measures are not directed at private enterprise or any one particular enterprise, and will not impact the regular business development of related enterprises.”

At the start of November Chinese authorities summoned Ant Group executives for “regulatory discussions” and scuppered the company’s dual listing on the Shanghai and Hong Kong bourses, which was originally scheduled for 5 November and expected to raise a record-breaking USD$34.4 billion.

On 24 December the State Administration for Market Regulation (SAMR) announced via its official website the launch of an investigation into monopolistic conduct by Jack Ma’s e-commerce platform Alibaba, while PBOC also summoned Ant Group for a second round of “regulatory discussions.”

Pan Gongsheng (潘功胜), PBOC deputy governor and director of the State Administration of Foreign Exchange (SAFE), said at a subsequent press conference that Chinese regulators demanded that Ant Group “return to its payment origins,” and that in the past the company had “regarded regulatory compliance demands with disdain.”

Authorities also stressed the need for all financial activities to be licensed, while calling for Ant Group to establish a financial holding company to facilitate the regulation of its varied operations.

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