According to the Xinhua News Agency, Xi at a meeting of China’s leaders on Monday regulated a platform company to maintain social stability. The phrase “platform business” in China usually refers to businesses that provide online services to customers.
The Chinese president added that it was necessary to strengthen regulation of the Internet sector, according to a summary of his remarks published by Xinhua. The state media reported that ‘all financial activities should be included in financial regulations’, according to Xi.
The published comments are Xi’s first words on the subject since December, when he described monitoring digital economy as one of China’s top priorities. for 2021.
Although Xi did not single out any company by name, its decision to redouble regulatory efforts could pose more problems for large technology companies such as Alibaba (BABY) and its financial subsidiary Ant Group, which has already struggled with increasing investigation.
Ant, which owns the popular digital payment app Alipay and has major interests in online investing, insurance and consumer loans, was forced to hold a major exchange last November and has since been ordered to revamp its business.
Beijing has long been concerned about the impact of technology companies on the financial sector, making the industry vulnerable – Ant now, for example, now commands more than half of China’s mobile payments market – and officials have sought ways to help them.
Regulators may soon require Ant to behave more like a traditional Chinese bank than a technology company, indicating that the business is severely restricted. The company is also in the midst of a recent uproar: CEO Simon Hu resigned late last week for personal reasons.
The next big battle for Alibaba, founded by Jack Ma, may not be far off. Its shares have been under pressure since then the Wall Street Journal reported last Thursday that the company is receiving a record fine for alleged monopolistic behavior. Alibaba declined to comment on CNN Business.
Tencent shares have also recently tumbled over rumors that it could be the next target regulators.
Regulators have already interviewed executives at Tencent and Pinduoduo, penalized Bytedance and Baidu with fines for alleged monopolistic behavior in corporate acquisitions, and enforced new rules that could control the operations of many technology companies.
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