Markets work in mysterious ways. In the Hong Kong stock exchange, Alibaba shares went up by 8 per cent on Monday. This was after the giant e-commerce player Alibaba was fined USD 2.8 billion on charges of violating anti-monopoly rules by Chinese regulators.
This fine comes as a relief to all stakeholders who were worried about the fate of the company after its difference with the regulator.
The ruling Communist Party is tightening control over China's biggest e-commerce and other internet companies and has warned them not to use their industry dominance to stifle competition. The State Administration for Market Regulation announced Saturday that Alibaba was fined for "abusing its dominant position" to limit competition in online retailing.
Other than the fine, the Chinese company is asked to revamp its operations and submit a compliance report within the next three years.
Accepting the fine, the company in its statement stated, “Over the past several months, we fully cooperated with the SAMR (State Administration for Market Regulation) investigation and seriously studied the government’s policies and expectations for Internet platform economies. In this connection, we conducted a self-assessment of, and implemented improvements to, our internal systems while ensuring stable operation of our business.”
This tussle with the regulator and Alibaba Group started after Jack Ma made a statement critical of the Chinese authorities. Post which, the Chinese authorities suddenly halted Ant Group’s initial public offering. Ant Group is the parent company of e-commerce player Alibaba.