Ant Group executives were summoned on Dec. 26 for talks about anti-monopoly practices with regulators and top financial watchdogs, including the People’s Bank of China (PBOC), the China Banking Regulatory Commission, the China Securities Regulatory Commission, and the Foreign Exchange Bureau.
The fintech giant, whose IPOs in Shanghai and Hong Kong were pulled, was asked to adjust its businesses and work out a rectification plan in accordance with the increasingly strict regulations for internet companies due to anti-trust concerns.
During the meeting, regulators also pointed out Ant Group’s existing problems, including its flawed corporate governance mechanism, engagement of regulatory arbitrage, defiance of regulatory compliance requirements, excluding rivals, and damaging the legitimate rights and interests of customers.
The meeting with the watchdogs came closely after Alibaba, the e-commerce giant owning 33% of Ant’s shares, was fined 500,000 yuan by the State Administration for Market Regulation (SAMR) as well as the ongoing anti-monopolistic investigation.
The regulators also proposed several requirements for Ant Group’s business adjustments. The company, which is China’s biggest mobile payment platform and Alipay’s parent, was asked to put the emphasis back on its payment operation, namely “returning to its payment origin.” The group was also demanded to enhance transaction transparency, avoid unfair competition, and establish a financial holding company.
Ant Group stated on Dec. 27, one day after the talk, that a rectification work group would be established to “fully implement requirements raised at the meeting to bring into line the operation and development of the financial-related businesses.”