Google, Microsoft, Apple and Facebook have something in common: they all responded to some monopoly accusations and several lawsuits involving possible dubious practices in the market. Despite this happening frequently in the West, China’s antitrust body decided to act to investigate the giant Alibaba.
According to the state regulatory committee, the giant created by Jack Ma has the well-known “choose one of the two” policies. That is, the retailer forces its marketplace partners to sell exclusively on its platform. This ends up preventing these merchants from offering their products on JD.Com, for example.
In its statement, China’s antitrust body did not offer details of the investigation. He just says that Alibaba is accused of monopoly politics.
For now, it is not yet clear what the penalty will be for Alibaba in case of conviction. Still, all major Chinese retailers are expected to meet soon to discuss other issues.
The state agency wants to make it very clear that these retailers cannot sell products below cost to increase their market share. In the Chinese government’s interpretation, this leaves room for monopoly, since the practice tends to harm smaller companies.
It is worth remembering that this is not Jack Ma’s only problem with the Chinese government. The country’s regulators recently blocked the Ant Group from being listed on the Stock Exchange. At the time, authorities accused the executive’s company of using Alipay to exploit the loan market without the necessary guarantees in that segment.