Chinese competition regulator plans to fine Meituan of around $ 1 billion

SINGAPORE — Chinese competition regulator to fine food delivery giant Meituan of around $ 1 billion for allegedly abusing market dominance to the detriment of traders and rivals , according to people familiar with the matter.

The sanction could be announced in the coming weeks, and Meituan would be required to reorganize its operations and end a practice that has been dubbed “er xuan yi” – literally, “pick one out of two,” the people said. Such exclusivity deals have forced many small businesses to choose sides in China’s competitive retail industry.

Meituan, with a market capitalization of around $ 170 billion, has raised billions of dollars from global investors and is China’s third-largest publicly traded internet company after Tencent Holdings Ltd. and Alibaba Group Holding Ltd. The Beijing-based company operates an online marketplace. for millions of restaurants and other traders, and is the largest food delivery and related service provider in China. It also offers hotel reservations and sells groceries online.

China’s State Administration for Market Regulation, the country’s main trade regulator overseeing Beijing’s antitrust push, imposed a record $ 2.8 billion fine on Alibaba in April for “er xuan” practices. yi ”, in which the e-commerce giant punished merchants who sold goods on its platform and in competing marketplaces. This fine was equivalent to 4% of Alibaba’s annual domestic sales.

The antitrust watchdog believes Meituan has also blocked companies from selling their products on competing platforms, people familiar with the matter said. His investigation into Meituan’s alleged monopoly behavior began in April. The company said it will cooperate fully with the investigation and is committed to complying with China’s anti-monopoly laws. Meituan declared the equivalent of $ 17.8 billion in revenue in 2020.

Source link

About Julie Gray

Check Also

Paris airport’s new DHL Express hub cuts delivery times

DHL Express has opened an expanded international parcel hub at Paris-Charles de Gaulle Airport to …

Leave a Reply

Your email address will not be published. Required fields are marked *