China fines Alibaba, Tencent-backed China Literature for not reporting deals to anti-trust regulators (updated)

China Literature

14/12/2020 05:42

(Adds details, background)
    SHANGHAI, Dec 14 (Reuters) - China's market regulator said
on Monday it fined Alibaba Group  BABA.N , Tencent
Holdings-backed  0700.HK  China Literature  0772.HK  and
Shenzhen Hive Box 500,000 yuan ($76,464.29) each for not
reporting deals properly for anti-trust reviews. 
    The State Administration of Market Regulation (SAMR) said it
had taken the decision after reviewing deals by the firms,
including Alibaba's deal with Intime Retail (Group) Co Ltd,
China Literature's acquisition of New Classics Media, and
Shenzhen Hive Box's acquisition of China Post Smart Logistics. 
    Hive Box's backers include logistics giant S.F. Holding Co
 002352.SZ .
    Hong Kong-listed shares of Tencent and Alibaba fell in
afternoon trade after the news, with Alibaba last down 2.5% at a
three-week low and Tencent down 2.8% at a two-week low. The
broader market  .HSI  fell half a percent.
    China has vowed to strengthen oversight of its big tech
giants, citing concerns that they have over the years managed to
build monopolies that curb competition and have amassed power to
misuse consumer data and violate consumer rights.
    Last month, Beijing issued draft rules aimed at preventing
monopolistic behaviour by internet companies, which was seen as
China's first serious regulatory move against the sector.
    The SAMR warned in a separate statement that "the Internet
industry is not outside the oversight of anti-monopoly law", and
urged all companies to strictly abide by laws and regulations
and maintain fair market competition. 
    "The fines of the three cases is a signal to society that
anti-monopoly supervision in the Internet field will be
strengthened," the SAMR said.
    Alibaba invested $692 million in Intime in 2014 and led a
$2.6 billion bid in 2017 to privatise Intime, which operated 29
department stores and 17 shopping malls in China.
    China Literature announced in August 2018 that it would
acquire 100% of New Classics Media. 
 ($1 = 6.5390 Chinese yuan)

 (Reporting by Brenda Goh in Shanghai, Cheng Leng and Zoey Zhang
in Beijing; Editing by Himani Sarkar)
 ((brenda.goh@thomsonreuters.com; +86 (0) 21 2083 0088; Reuters
Messaging: brenda.goh.thomsonreuters.com@reuters.net))