Alibaba shares tumble after reviews of China’s antimonopoly investigation

Alibaba Group’s signage will be displayed during the company’s December 11th Global Shopping Festival on November 11, 2020 in Hangzhou, Zhejiang Province, China.

Aly Song | Reuters

BEIJING – Alibaba’s shares fell for prolonged periods in both Hong Kong and U.S. trading as reports surfaced that the Chinese government is conducting an anti-monopoly investigation into the tech giant.

China’s state market regulator said Thursday through official online channels that it had launched an investigation into Alibaba for monopoly practices. The main problem was a practice that forces traders to choose one of two platforms instead of being able to work with both.

The news follows mounting – and largely unexpected – pressure from Chinese authorities to curb their largest tech companies through regulatory action.

Alibaba confirmed the market regulator’s investigation in a public statement, saying “business operations remain normal.”

Bloomberg first covered the news announced by the Chinese state news agency Xinhua.

Alibaba’s Hong Kong-listed shares fell more than 8% on Thursday morning.

Alibaba shares traded in New York fell more than 3% after close of trading on Wednesday.

The regulators meet with Jack Ma’s other company

Also on Thursday, Chinese authorities said they would meet with Alibaba subsidiary Ant to oversee the financial technology company on issues such as market-oriented behavior and taking into account consumer rights and interests.

People’s Bank of China said on its website that the other participating regulators are the China Banking and Insurance Regulatory Commission, the China Securities Regulatory Commission and the State Administration of Foreign Exchange.

Ant confirmed in a public statement that he received a notice from regulators for a meeting on Thursday. Last month, regulators abruptly suspended the company’s massive IPO a few days before the planned Hong Kong and Shanghai listing.

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