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China Intensifies Antitrust Scrutiny On Domestic Tech Businesses

China Intensifies Antitrust Scrutiny On Domestic Tech Businesses

June 17, 2021 at 10:31PM
by PYMNTS

Chinese officials are stepping up antitrust probes into numerous domestic technology firms, popping into facilities unannounced, The Wall Street Journal (WSJ) reported.

The agencies involved include the State Administration for Market Regulation, the Cyberspace Administration of China, and the State Tax Administration, according to WSJ, which cited unnamed sources. During some of the on-site audits, officials questioned senior executives and downloaded all types of records.

Didi Chuxing was one company that had visits from Chinese government officials, the cyber police and tax authorities, WSJ reported, citing the ride-hailing platform’s IPO prospectus.

The on-site audits follow officials’ requests for self-examination submissions from 34 tech firms in April, according to WSJ. The firms were given 30 days to create anti-competition practices and guarantee that they would adhere to the new technology mandates. After that time period, the Chinese antitrust watchdog asked provincial-level regulators to conduct follow-up inquiries.

Some of the 34 firms included TikTok parent ByteDance, food delivery platform Meituan, and social media giant Tencent, but it is unknown which companies were visited by agents, WSJ reported. The review doesn’t mean the companies will face punishment.

Laws passed in April make Chinese government oversight mandated for almost all data-related activities in the country. China also summoned 13 tech firms — including Tencent, ByteDance, JD.com, Meituan and Didi — for a meeting with the country’s central bank and watchdog agencies.

Chinese officials in April also took a deeper look into the app-based platform Meituan, which offers numerous online booking services for meal delivery, hotels, flights, taxis and restaurant reservations.