Chinese regulators are handing down new laws that will restrict the finance operations of some of the country’s biggest technology firms, Bloomberg reported on Thursday (April 29).
Tencent, ByteDance, JD.com, Meituan and Didi are among 13 tech businesses in China that are being summoned to meet with the country’s central bank, as well as several watchdog agencies. New mandates include stricter compliance for global listings, limits on information monopolies and transparency on data gathering.
The restrictions are similar to those levied against Jack Ma’s Ant Group earlier this year after its initial public offering (IPO) was halted by Chinese regulators in December 2020.
“Nobody can escape the tough regulatory crackdown on FinTech,” said Zhang Xiaoxi, a Beijing-based analyst at Gavekal Dragonomics, per Bloomberg. “While the requirements are broadly in line with those imposed on Ant, those who are considering listing need to wait till they rectify all the problems.”
The new regulations indicate that the financial services divisions of Big Tech firms must be restructured as part of a larger scheme for stricter supervision, according to a joint statement from the central bank, banking and insurance regulator, securities regulator and forex regulator, per Bloomberg. Further, “improper links” must be cut between a company’s existing payment services and financial products.
Tech firms in China earlier this month were given a one-month deadline to revamp anti-competitive practices and publicly pledge to uphold regulations. Chinese watchdogs also issued new IPO restrictions, prompting some 84 companies this year to withdraw applications.
Meituan, which is under close scrutiny by Chinese regulators, said this week that it would cooperate with all inquiries. The eCommerce platform offers meal delivery, hotel reservations, flight schedules, taxi reservations and restaurant bookings.
Alibaba was hit by record-high fines of roughly $2.8 billion tied to Chinese antitrust violations, handed down earlier this month by the State Administration for Market Regulation (SAMR).
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