The Middle Kingdom's Securities Regulatory Commission last Friday announced a ¥7.123 billion ($984 million) fine for Alibaba's fintech operation, Ant Group, and ordered the closure of its health insurance service, Xianghubao. Tencent 'fessed up [PDF] to having received a notification of a ¥2.9 billion ($414 million) fine from the People's Bank of China.
Ant Group was found to have broken laws covering insurance, investments, money laundering, and more. Alibaba had already decided to close Xianghubao. Tencent was fined for failing to properly manage some aspects of its Tencent Pay service.
Beijing's concerns over Ant Group's operations saw it order a last minute cancellation of the Alibaba limb's planned 2020 stock market debut – at the time the world's all-time highest-valued IPO. While Beijing was worried about some of the loan products Ant Group offered, halting the IPO was also seen as retaliation for founder Jack Ma making anti-Beijing remarks....
Beijing's announcement of the fines – complete with detail of why they were levied, plus authorities mentioning a return to normalized regulation – suggests China has now addressed those issues and ended its years-long investigation into the power and conduct of its web giants.
But its actions have left a major mark on Alibaba, which has decided to split into six companies and has reshuffled its executive leadership.
Add comment