Alibaba to Withdraw from 'Taiwan Taobao' by the End of This Year
[Asia Economy Reporter Sung Ki-ho] Alibaba's e-commerce platform Taobao is withdrawing from its Taiwan business. Taobao had been circumventing entry by establishing subsidiaries in third countries rather than mainland China.
According to Taiwanese media on the 15th, Alibaba's "Taobao Taiwan" issued a statement announcing that it will withdraw from Taiwan by the end of this year.
Taobao Taiwan started its business in Taiwan in October last year. The reason for withdrawal was explained as "market uncertainty."
The Taiwanese government restricts investments from Chinese companies. However, Alibaba chose to circumvent this by entering through the UK. In response, Taiwan's Ministry of Economic Affairs Investment Review Committee concluded in August that Alibaba Group effectively controls Clada Venture Investment, thus classifying Taobao Taiwan as a Chinese company, and demanded that it recover its investment or rectify ownership structure issues within six months.
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At the same time, Alibaba was fined 410,000 Taiwan dollars (approximately 17 million KRW) for violating cross-strait exchange-related regulations by exercising control over Clada Venture Investment.
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