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The tech giant Alibaba gets a hit of $2.8 billion not in profit but in fine from the Chinese authorities. The fine was charged for the alleged monopolistic practice of Alibaba. Back in December is when Alibaba fell into the watchful eyes of the Chinese authorities. The reason being the policy of Alibaba which forces merchants to sell their products exclusively through Alibaba platforms and also prevents them to sell from other rival e-commerce platforms.
Many Chinese websites have posted that the investigation on Alibaba proved that the policy has eliminated competition and has obstructed the innovation in the online retail sector of the country. In consequence, Alibaba is penalized by China’s antimonopoly law by the Chinese regulators. The company now has to pay a fine equal to four percent (4%) of their domestic sales in the country. Alibaba is now ordered to stop their illegal activities and properly carry their social responsibilities.
Jack Ma, Founder of the Alibaba Group
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As Alibaba is caught in a $ 2.8 billion fine this is not the first time Chinese authorities have slapped an antimonopoly law fine on a tech-related company. Back in 2015 tech giant, Qualcomm suffered a similar fate when they were ordered to pay a $975 million fine by Chinese regulators for violating the antimonopoly law.
The amount of $2.8 billion seems a lot for us to process but the amount is unlikely to make any dent in the fortune of Alibaba. As reports from The New York Times read that Alibaba reported profits of more than $12billion in the last three months of 2020.
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