Maligned Ma Yun... China Officially Investigates Alibaba for Monopoly

Criticism of Authorities Leads to Retaliation Against Ma Yun, the Founder Marked as 'Unlucky'

▲Jack Ma, Founder of Alibaba [Image source=Yonhap News]

[Asia Economy Reporter Kwon Jae-hee] Chinese regulatory authorities have officially launched an investigation into Alibaba Group's monopoly allegations. The Chinese government maintains that proper oversight is necessary for internet companies that have grown excessively large due to lax regulations, but interpretations are gaining traction that this is essentially a retaliatory measure against Alibaba founder Ma Yun, who has fallen out of favor with the government.

According to Bloomberg on the 24th, China's State Administration for Market Regulation stated in a press release that "authorities are currently investigating Alibaba." The regulatory body also added that it plans to summon its affiliate Ant Group. However, it did not disclose specific details, only mentioning "monopoly allegations." On the same day, Ant Group issued a statement saying it will "comply with the authorities' strict regulatory requirements."

This move came just one day after regulators announced, together with the Ministry of Commerce, that they would strictly supervise major e-commerce platforms. The companies summoned to the meeting included Alibaba, Tencent, JD.com, Meituan, Pinduoduo, and Didi. China argues that as major internet companies like Alibaba and Tencent have grown enormously under lax regulations, enhanced oversight is necessary.

Earlier, on the 14th, the State Administration for Market Regulation fined Alibaba and Tencent 500,000 yuan (approximately 83 million KRW) each for violating antitrust laws by acquiring some businesses without notifying authorities. Local media interpreted the relatively small fines as a strong warning message, marking the first time sanctions have been imposed on giant internet companies.

Some interpret this as retaliation for Alibaba founder Ma Yun’s strong criticism on October 24th at an event attended by high-ranking officials including Chinese Vice President Wang Qishan and People's Bank of China Governor Yi Gang, where he said, "Chinese financial authorities still cannot escape the 'pawnshop business' of lending only with collateral."

Following this, Ant Group’s IPO was indefinitely postponed, and it is reported that Ma Yun sought forgiveness by expressing his willingness to donate part of his company to the Communist Party.

Given that the Chinese Communist Party has historically imposed harsh regulations on companies that fall out of favor, this interpretation is further supported. According to The Wall Street Journal (WSJ), real estate company Dalian Group and Anbang Insurance were either nationalized by government order or had their founders sentenced to long prison terms.

Meanwhile, in response to this news, shares of SoftBank Group, the largest shareholder of Alibaba, fell 2.3% on the Tokyo Stock Exchange.

This content was produced with the assistance of AI translation services.