The China Antimonopoly Bureau was officially launched on November 18, 2021. It is located in the same building as the country’s largest market regulator, the State Administration for Market Regulatory, in Beijing. Photo: Li Hao/GT
The Political Bureau of the Communist Party of China Central Committee held a meeting on Friday, noting that the platform’s economy should develop in a healthy way. Experts noted that the positive narrative marks the end of the latest round of strict correction and suggested policies that encourage sector growth in order to boost the Chinese economy.
Officials at the meeting agreed that “corrections for the platform economy will be completed, regular supervision will be initiated, and specific measures to support its record and healthy growth will be revealed.”
The change from “bolster” corrections to “complete” marks the end of this round of sector-specific corrections, while the meeting confirming the deployment of “specific measures” also shows that rules for regular supervision may be issued soon, Pan Helen, Joint Director of the Research Center for the Digital Economy, said. and Financial Innovation of Zhejiang University International Business School, Global Times.
It is widely expected that fine-tuning oversight of the platform’s economy will be fine-tuned, as this round of crackdowns on the homogeneous behavior of Internet giants has mainly achieved the desired effect, and the sector is also important to anti-epidemic efforts and restore true value. The economy, especially in job stability, said Li Yi, a senior researcher with the Internet Research Center of the Shanghai Academy of Social Sciences.
“As an essential part of the private economy, Internet companies have created a huge number of jobs, and thriving entrepreneurship not only produce new jobs, but add fortunes to society,” Lee told the Global Times.
After the Politburo meeting, Chinese Internet companies led a broad rally in the Chinese stock market on Friday. Hang Seng Tech is up 10 percent. Alibaba’s Hong Kong trading rose 16 percent to 102.1 HK dollars ($13) to close, Meituan shares rose 16 percent to HK$172 and Tencent 11.07 percent to HK$377.4.
While US stocks fell on Friday, Alibaba’s trading in the US market still jumped 6.8 percent to $97.68.
Domestic internet giants, including Alibaba, Tencent and JD.com, did not immediately respond on Saturday.
“After two years of special adjustments, the platform economy in China has re-emerged with a completely new look,” Pan said, noting that illegal and unfair practices that impede the development of other industries and harm personal privacy, among other things, have been removed.
Since the end of 2020, China has launched an antitrust crackdown targeting the Internet sector, as the massive expansion of the sector in recent years has caused market turmoil and increased risks.
In October 2021, Chinese food delivery platform Meituan was fined 3.44 billion yuan ($520 million), or 3 percent of its 2020 domestic revenue by the State Administration for Market Regulation (SAMR), for monopolistic practices.
In April 2021, SAMR fined local e-commerce giant Alibaba 18.23 billion yuan for violating antitrust laws. The regulator also summoned 34 internet companies, including Alibaba, Tencent, Baidu and JD.com, urging them to launch internal investigations and make corrections over cases involving “choosing one of two”.
Pan said that the platform economy is of crucial importance to the Chinese economy amid the epidemic and complex global situations, and its supporting role should be given a full role. “While regulating the sector, the authorities should promote the development of the platform economy to solve the problem of inefficient resource allocation and create new economic growth points and more jobs by encouraging new platform-related business models,” he said.
On March 16, a meeting of the Financial Stability and Development Committee of the State Council of China also urged relevant departments to improve plans for managing the platform’s economy. They should go ahead and complete patch work on large platform companies as soon as possible through standard, transparent and predictable regulations, according to the meeting.
Officials said during the meeting that the “red lights” and “green lights” should promote the steady and healthy development of the platform’s economy and improve its international competitiveness.
On the other hand, the country is speeding up the amendment of the anti-monopoly law to strengthen regulations on the platform economy. Jan Lin, Deputy Minister of the Syrian Arab Republic, said in a press conference on April 26 that the anti-monopoly law amendments have been submitted to the National People’s Congress of China, and are expected to be passed by the end of 2022.