Home Business Why China Is Cracking Down on Its Technology Giants: QuickTake

Why China Is Cracking Down on Its Technology Giants: QuickTake


With fines, regulatory orders and forced restructurings. In late July China ordered more than two dozen tech companies to carry out internal inspections and address issues such as data security. Earlier, Ant, which was about to go public before being stopped by regulators in November 2020, agreed to turn itself into a financial holding company, making it subject to capital requirements similar to those for banks. Regulators levied a record $2.8 billion fine against Alibaba for alleged monopolistic conduct and ordered it to change its business practices. Didi had to remove its main app and dozens of others from smartphone stores as it faces the prospect of unprecedented penalties. Tencent, operator of the WeChat super-app, has been ordered to give up exclusive music streaming rights while Meituan and Pinduoduo Inc. have also fallen foul of regulators. The tutoring sector, where companies such as TAL Education Group garnered multibillion-dollar valuations, saw its future redefined in one sweeping order that banned them from making profits and raising capital and also limited what they can teach. The speed of change has been dizzying with rules to curb monopolistic practices drafted and finalized in just three months.

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