Tech giants Tencent Holdings, Baidu, ByteDance and Didi Chuxing have been fined by Chinese regulators for falling foul of the country’s antitrust laws.
A statement from the Chinese State Administration for Market Regulation said that multinational conglomerate Tencent and internet company Baidu have both been fined ¥500,000 ($77,000). Tencent was penalised for its investment in edtech company Yuanfudao in 2018, while Baidu was fined for its 2014 acquisition of Ai Nemo. Didi Chuxing and SoftBank were also fined, along with eight other companies.
Among these was Beijing Liangzi Yuedong Technology, a ByteDace-backed company that was fined for a 2019 joint venture with Shanghai Dongfang Newspaper.
According to the Chinese State Administration for Market Regulation, the fines were issued because the companies failed to obtain approval before deals were finalised. It means that even though the deals themselves did not impact competition levels, they still violated China’s anti-monopoly laws.
While the latest fines are relatively small, this comes amid a crackdown on antitrust business practices from Chinese regulators. The country’s tech sector is heavily associated with the creation of tech behemoths through mega-mergers and “super apps”, such as Tencent’s WeChat.
But the relationship between the Chinese state and Chinese tech companies appears to be souring. According to the State Administration for Market Regulation, 108 antitrust investigations were completed in 2020, compared with 46 in the previous year.
Ecommerce giant Alibaba has so far borne the brunt of the crackdown and is reportedly facing a record fine of $1bn over anti-competitive practices. Last year Chinese fintech giant Ant Group’s much-anticipated IPO was halted by the Chinese authorities at the 11th hour due to “changes to the financial technology regulatory environment and other major issues”. Many have speculated that this was an attempt to rein in Ant Group chairman Jack Ma, who also owns Alibaba.
Last month, the State Council Antitrust Committee released new anti-monopoly guidelines designed to place internet companies under greater scrutiny when it comes to monopolistic practices.