On the morning of December 24, Xinhua News Agency released a message saying that recently, the State Administration for Market Regulation, based on reports, has filed a case against Alibaba Group Holding Limited for suspected monopolistic practices such as “choose one of two”.

At the same time, Xinhua News Agency released news that relevant national financial management departments will call Ant Group for talks in the near future.

For Internet-related industries, these regulatory measures once again send out strong warning signals.

It is worth mentioning that Alibaba responded to the investigation by saying:

Today, Alibaba received a notice from the State Administration for Market Regulation, which has filed a case against Alibaba for suspected monopolistic behavior. Alibaba will actively cooperate with the regulatory authorities in the investigation. Currently, the company's business is operating normally.

Alibaba is under investigation, People's Daily publishes comment

The investigation of Alibaba this time reminds people of a regulatory development made by the State Administration for Market Regulation not long ago.

Leifeng.com noticed that just ten days ago, on December 14, the State Administration for Market Regulation also issued an announcement stating that based on reports under the Anti-Monopoly Law, the State Administration for Market Regulation decided to impose administrative penalties on three market entities for three cases of illegal implementation of business concentration without reporting in accordance with the law.

One of the market players is Alibaba Investment, the main entity of Alibaba Group for investment and mergers and acquisitions.

According to the report, from March 2014 to June 2017, Alibaba Investment acquired a total of 73.79% of Intime Retail's shares in three transactions, becoming Intime Retail's controlling shareholder; in February 2018, Alibaba Investment's shareholding ratio increased further - however, before investing in the acquisition of Intime Retail's shares, Alibaba Investment did not file a concentration of operators declaration in accordance with the law.

For this reason, the State Administration for Market Regulation fined Alibaba Investment 500,000 yuan.

In contrast, this investigation targets the operating entity of Alibaba Group - the reason is that it implemented suspected monopolistic practices such as "choose one of two".

Leifeng.com noted that in response to the investigation of Alibaba, the People's Daily commented:

Based on the report, the State Administration for Market Regulation opened an investigation into Alibaba after preliminary verification and research. This is an important measure for my country to strengthen anti-monopoly supervision in the Internet field, which is conducive to regulating industry order and promoting the long-term and healthy development of the platform economy.

The commentary said that my country's platform economy and online economy are at the forefront of the world, which is inseparable from the great era of reform and opening up, benefiting from China, the world's largest market, and benefiting from government policies and measures to encourage development and innovation; but encouragement and regulation should be given equal importance, and the online economy must innovate and develop in accordance with laws and regulations.

The commentary also emphasized that the Anti-Monopoly Law applies to all entities, and treats domestic and foreign capital, state-owned enterprises and private enterprises, large enterprises and small and medium-sized enterprises, Internet companies and traditional enterprises equally and fairly. The purpose is to ensure that all types of market entities participate equally in market competition.

Finally, the comment also stated:

The initiation of this investigation does not mean that the country's attitude towards encouraging and supporting the platform economy has changed. It is precisely to better regulate and develop the platform economy, guide and promote its healthy development, and make greater contributions to the high-quality development of China's economy. It is believed that by strengthening antitrust supervision, obstacles that affect the healthy development of the platform economy can be eliminated, and the platform economy will also usher in a better development environment.

Ant Group was interviewed again, and the Economic Daily published a comment

On the same day that Alibaba Group was investigated, there were new developments in the supervision of Ant Group.

According to Xinhua News Agency, the People's Bank of China, the China Banking and Insurance Regulatory Commission, the China Securities Regulatory Commission, and the State Administration of Foreign Exchange will call for talks with Ant Group in the near future to urge and guide Ant Group to implement financial supervision, fair competition, and protection of consumers' legitimate rights and interests in accordance with market-oriented and rule of law principles, and standardize the operation and development of its financial business.

This development easily reminds people of a regulatory development on November 2: the People's Bank of China, the China Banking and Insurance Regulatory Commission, the China Securities Regulatory Commission, and the State Administration of Foreign Exchange held a regulatory interview with Jack Ma, the actual controller of Ant Group, Chairman Jing Xiandong, and President Hu Xiaoming.

Compared with the conciseness of the last meeting, this meeting had a clearer statement on the regulatory direction of Ant Group - to standardize the operation and development of financial business.

Leifeng.com noted that the Economic Daily also published a comment on the second interview. The commentary believes that this shows that it is urgent to regulate the development of the platform economy, and it also once again shows the serious attitude and firm determination of the regulatory authorities to strengthen supervision and promote the healthy development of the platform economy.

The commentary also stated that only if platform companies develop steadily on a standardized and orderly track, respect regulatory rules, and maintain innovative vitality, can they form real core competitiveness, achieve win-win results for the country, enterprises and consumers, and make positive contributions to high-quality economic development.

Shortly after the news of the second meeting was released, Ant Group also responded, saying:

Today, we received a notice of an interview from the regulatory authorities. We will carefully study and strictly comply with the requirements of the regulatory authorities and implement the relevant work without fail.

Leifeng.com noticed that in fact, after the first meeting, Ant Group had made a public statement and adjusted many of its products.

At the 4th China Internet Finance Forum held on December 15, Ant Group Chairman Jing Xiandong said that for more than a month, under the guidance of regulators, Ant Group has made every effort to do a good job in the aftermath of the suspension of listing. Ant Group has compared itself with the requirements of the regulatory authorities, looked in the mirror, found its shortcomings, conducted physical examinations, actively cooperated with supervision, and further implemented regulatory requirements.

Jing Xiandong also said: A series of measures introduced by the regulatory authorities have fully incorporated financial technology into the regulatory framework, opening a curtain for more stable and higher-quality development for our financial technology institutions.

In addition to statements, there are also concrete actions.

Just last week, Alipay removed bank deposit products from its wealth management page for users who did not hold internet deposits. In response, Ant Group said: In accordance with regulatory requirements for the internet deposit industry, all internet deposit products on the Ant platform have been removed from the shelves and are only visible to users who have purchased the products. Users who hold the products will not be affected.

At the same time, Ant Group's Huabei and Jiebei businesses have also been adjusted. For example, some netizens' Huabei credit limit was significantly adjusted from 30,000 yuan to 3,000 yuan. In response, Huabei said that it is adjusting the credit limit of some young users recently to promote more rational consumption habits.

summary

These two regulatory developments on December 24 were not particularly surprising.

In January this year, the draft revision of my country's Anti-Monopoly Law was released for public comments, which specifically mentioned that in determining whether an operator in the Internet field has a dominant market position, factors such as network effects, economies of scale, lock-in effects, and the ability to master and process relevant data should also be considered.

On November 10, the State Administration for Market Regulation issued an announcement soliciting public opinions on the "Anti-monopoly Guidelines for the Platform Economy (Draft for Comments)" (hereinafter referred to as the "Guidelines") - these "Guidelines" are considered to be anti-monopoly regulatory rules directly targeting Internet platforms.

Judging from the current situation, my country will increase its efforts in anti-monopoly and preventing the disorderly expansion of capital.

On December 11, the Political Bureau of the CPC Central Committee clearly emphasized at a meeting that the next step is to "strengthen anti-monopoly and prevent the disorderly expansion of capital." This can be said to have sounded the alarm for anti-monopoly and preventing the disorderly expansion of capital from the highest decision-making level.

Moreover, at the Central Economic Work Conference held from December 16 to 18, eight key tasks were identified for next year, of which the sixth point specifically talked about "strengthening anti-monopoly and preventing disorderly expansion of capital". Specifically:

Anti-monopoly and anti-unfair competition are the inherent requirements for improving the socialist market economic system and promoting high-quality development. The state supports platform enterprises to innovate and develop, enhance international competitiveness, and support the common development of the public and non-public economies. At the same time, it is necessary to regulate development in accordance with the law and improve digital rules. It is necessary to improve legal norms in the identification of platform enterprise monopolies, data collection and use management, and consumer rights protection. It is necessary to strengthen regulations, enhance regulatory capabilities, and resolutely oppose monopoly and unfair competition. Financial innovation must be carried out under the premise of prudent supervision.

This provides guidance for our country in terms of Internet anti-monopoly and preventing disorderly expansion of capital.

In fact, around the world, an anti-monopoly movement is sweeping the Internet sector. At least, judging from the trends of the two major Internet powers, China and the United States, while the global Internet development is moving towards regional fragmentation and even gradual disconnection, they have also reached a rare consensus on the pace of their respective anti-monopoly issues.

As for my country's Internet industry, after more than 20 years of development, its development will undoubtedly continue to penetrate into the development of the country's economy and society and continue to contribute to digitalization; but it is certain that all industries, including the Internet industry, will be included in the policy operation track and move forward steadily under supervision.

Not only that, in the context of the country vigorously emphasizing the importance of scientific and technological innovation and taking scientific and technological self-reliance as the strategic support for national development, Chinese Internet companies should shoulder the historical responsibility entrusted by the times, play the role of innovation subjects, and take scientific and technological innovation as the fundamental driving force for their own development.

As a result, the capital expansion development routine of "burning money first and reaping the benefits later" that Internet companies used to adopt has come to an end, and a new development era in which Chinese Internet companies move towards in-depth technological innovation and survive on technological strength has also begun.

In a word: technology companies should put innovation first.

References for this article: