Ant Group met with Chinese financial authorities

Ant Group met with Chinese financial authorities
Photo: http://www.pbc.gov.cn/goutongjiaoliu/113456/113469/4229432/index.html 22.04.2021 615

On April 12 China’s financial regulators – People’s Bank, Banking and Insurance Regulatory Commission, Securities Regulatory Commission and State Administration of Foreign Exchange – called for another meeting with Ant Group. On behalf of four authorities, the Deputy Governor of the People’s Bank of China Mr. Pan Gongsheng addressed the media journalists.

Mr. Pan explained that after the first meeting last December Ant Group had established a dedicated group to develop a rectification plan under the guidance of financial regulators. The new meeting was intended to emphasize the significance of current problems in Company’s current financial operation and the importance of rectification measures as well as to synchronize the plan with the official requirements. The authorities noted that Ant Group must respect relevant laws in its operation and to respond actively to national development strategy.

Since the launch of plan preparation, financial authorities have actively communicated with Ant Group and urged it to formulate comprehensive and practicable measures. The plan includes five key points, which are: to rectify unfair competition in financial services and provide consumers with wider choice of payment methods; to break informational monopoly; to reorganize the Group into a financial holding company and to include all its operators of financial services in this structure for regulation; to respect the requirements of ‘prudent supervision’; and to manage and control liquidity risks of major funding products.

Specifying next steps to enforce regulation of platform companies, the Deputy Governor mentioned that science and technology should not ‘cover’ unlawful behavior. He said that the entire financial regulation must fall under the scope of regulation and that development was no less important than rule making.

Ant Group is an affiliate company of Alibaba and operates China's leading digital payment platform Alipay.

The progress in Ant’s restructuring comes at the backdrop of tightening state’s supervision over digital platforms. In November an upcoming Ant’s Record IPO was suspended in Shanghai and Hong Kong Stock Exchanges, reportedly due to the changing regulatory environment. This January the People’s Bank of China released the Draft Regulations for Non-Banking Payment Systems, which are widely considered an antitrust measure, ‘aimed directly at tech giants’. A few days ago the market watchdog imposed a 2.78 bil USD penalty on the Alibaba Group for the anticompetitive practices.

digital markets  China 

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