China’s market regulator has taken its first major step towards curbing the monopolistic power of its tech giants, drawing up draft antitrust rules that have sent shares in companies such as Alibaba, Tencent, and Meituan tumbling, reported the Financial Times.
Until now, Chinese regulators have taken a relatively hands-off approach to antitrust, even as authorities in the US and Europe launched inquiries and investigations into Amazon, Facebook, Google, and others.
This is in spite of the fact that Chinese tech companies have been building increasingly captive ecosystems, with users being prevented from using WeChat Pay to purchase products in Alibaba’s Taobao online store, for instance, or easily sharing links to Taobao goods within WeChat.
The new guidelines mark the first time the State Administration for Market Regulation has directly tackled anti-competitive behavior in the internet sector.
“It signals the end of an era — it will fundamentally change the competition landscape in China for internet companies,” said Scott Yu, an antitrust expert at Zhonglun Law Firm.
