HONG KONG – Chinese regulators have ordered Ant Group, the world’s largest financial technology company, to rectify their businesses and comply with regulatory requirements amid further scrutiny of anti-monopoly practices in the international sector. the web of the country.
The People’s Bank of China, the country’s central bank, summoned Ant executives on Saturday and ordered them to put together a correction plan and implementation schedule of their business, including its credit, insurance and wealth management services. , the regulators said in a statement Sunday.
The statement said Ant Group did not have strong regulatory mechanisms, violated regulatory compliance requirements and engaged in regulatory arbitrage. They also said the company used its market position to stifle competitors and to hurt consumers’ rights and interests.
The meeting came after Chinese regulators last month suspended a $ 37 billion Ant stock debate in Shanghai and Hong Kong over regulatory changes, and will come just days after China’s scrutiny against monopoly e-commerce giant Alibaba Group BABA,
owns a 33% stake in Ant Group.
The orders from regulators could limit Ant Group’s expansion and throw their profitable financial businesses into disarray.
Ant Group, which started as a payment service for Taobao, Alibaba’s e-commerce platform, has expanded to offer insurance and investment products to hundreds of millions of customers on mainland China. Jack Ma, founder of both Alibaba and Ant Group, is one of the richest and most prominent entrepreneurs in China.
Managers ordered Ant Group to set up a financial holding company and maintain sufficient capital. They also said that Ant Group should return to its payroll sources, increase transparency around transactions and prohibit unfair competition, while improving corporate governance and ensuring compliance with regulatory requirements for its businesses.
Ant Group said in a statement Sunday that it would comply with regulatory requirements and strengthen risk management and control, and that a working group would be set up to make the necessary corrections.
“We value the guidance and assistance of financial regulators,” the statement said. “The correction is an opportunity for Ant Group to strengthen the foundation for growing our business in full compliance, while maintaining the focus on innovating for social good and serving small businesses.”
The study of Ant Group and Alibaba is coming and China is closely examining the impact of the country’s internet sector.
Last month, China released draft rules to ban anti-competitive practices in the industry, such as signing restrictive agreements with buyers and the use of subsidies to eliminate competitors.
Alibaba and company turned by Tencent Holding Ltd. TME,
they were fined this month for not applying for official approval before proceeding with some purchase.
Last Tuesday, regulators met with Alibaba officials and five other major Chinese internet companies and warned them not to abuse their dominance to outrun competitors through the use of restrictive contracts, predatory prices and other tactics, according to a statement by the State Market Administration.