China’s efforts to ramp up its regulatory game continued on Tuesday (Nov. 10) with the release of draft rules for governing eCommerce giants and payments services with the goal of curbing monopolistic behavior, Reuters reported.
Once again, regulators are targeting Ant Group and Alipay. Last week, Ant Group’s planned initial public offering (IPO) of stock collapsed when the company, led by billionaire Jack Ma, got hit with new FinTech regulations.
China-based Ant Group is the financial arm of Ma’s Alibaba Group.
Reuters reported that China’s State Administration for Market Regulation (SAMR), which issued the draft, said it is out to prevent platforms from using business practices meant to hurt their competitors. Draft rules will look at preventing such eCommerce actions as the host company restricting brands from selling on multiple platforms.
According to the report, a number of competitors and merchants have charged that Alibaba has used such practices. In fact, SAMR officials met with representatives of more than 20 platforms last year to ask them to stop requiring merchants to sign such exclusive deals.
China’s SAMR said it will accept feedback on the draft rules until Nov. 30.
“In accordance with FinTech’s financial nature, we will bring all financial activities under a unified scope of supervision,” Liu Fushou, chief legal counsel at the China Banking and Insurance Regulatory Commission, said on Friday (Nov. 6).
Ant Group had initially estimated raising $37 billion in its IPO, which would have had the company listed by both the Shanghai and Hong Kong stock exchanges in China. However, the Shanghai Stock Exchange pulled the plug on the IPO in the wake of Beijing’s release of a set of regulations that would have forced Ant to revamp its business model.