China set to impose $1-billion fine on Meituan over antitrust issues

Firm asked to revamp operations and end exclusivity pacts with some merchants

China plans to levy a roughly $1-billion fine on Meituan for abusing its market position as antitrust regulators wrap up a four-month-old investigation into the food delivery giant, according to a person with knowledge of the matter.
 
The State Administration for Market Regulation could announce the penalty in coming weeks and the figure could still change ahead of the final decision, the person said, asking not to be identified discussing private deliberations. The company will be required to revamp its operations and end its exclusivity arrangements with merchants known as “pick one from two,” the person added. The Wall Street Journal earlier reported the potential fine.

 
Meituan representatives didn’t immediately respond to requests for comment. The antitrust watchdog had announced an investigation into the company in April, weeks after slapping a record $2.8-billion fine on fellow internet giant Alibaba Group Holding for abusing its market dominance. Since then, the tech crackdown has extended to other aspects of the industry, including the launch of a cybersecurity investigation into fellow giant Didi Global Inc. days after the firm’s blockbuster US listing.
 

In July, authorities posted regulations ordering China’s online food platforms — of which Meituan is the largest — to ensure workers earn at least the local minimum wage while the internet industry regulator announced a six-month campaign to root out illegal online behavior, further exacerbating a sell-off in tech shares that began with a wide-ranging crackdown on online education.

 
Alibaba warns of higher taxes
 
Alibaba Group Holding has warned investors that years-long government tax breaks for the internet industry will start to dwindle, adding billions of dollars in costs for China’s largest corporations.
 
The company told some investors during post-earnings calls this week that the government stopped treating some of its businesses as so-called Key Software Enterprises.

Didi weighs giving up data control to Beijing

Chinese ride-hailing firm Didi Global is in talks with state-owned information security firm Westone to handle its data management and monitoring activities, sources said, as part of its efforts to placate domestic regulators.The sources declined to be named as they were not authorised to speak to the media. The largest Chinese ride-hailing group became the target of an investigation by regulators in the country just days after it raised $4.4 billion in an initial public offering in the United States. The powerful Cyberspace Administration of China (CAC) last month launched a data-related cybersecurity investigation into Didi, citing the need to protect national security and the public interest.     (Reuters)

 

China Telecom seeks $7.3 bn in top 2021 IPO

China Telecom, one of the three mainland telecom carriers booted off the NYSE, is planning to raise 47.1 billion yuan ($7.3 billion) from a listing in Shanghai that is set to be the world’s biggest this year. The A-shares were priced at 4.53 yuan apiece, above the firm’s book value of 4.49 yuan each.   (Bloomberg)