Explainer | China’s e-commerce crackdown: timeline of Beijing’s actions to bring tech giants in line with national policy

China has long been recognised as the world’s biggest e-commerce market, driven by technology giants that helped revolutionise consumer spending behaviour in the second-largest economy behind the United States.

The value of these Big Tech companies – led by e-commerce stalwarts Alibaba Group Holding, JD.com, Meituan, Pinduduo and Tencent Holdings – continued to rise last year, despite the disruptions caused by the Covid-19 pandemic. Benefiting from a global stock market rally among tech firms as the pandemic receded, they each added more than US$100 billion in value over the year, according to a Hurun Research Institute report, which was based on data up to October 2020.

On November 6 last year, the Cyberspace Administration of China (CAC), the State Administration for Market Regulation (SAMR) and the State Tax Administration (STA) discussed with 27 major internet companies – including Tencent, Baidu, Meituan, ByteDance and Alibaba – ways of bringing order to the digital economy and solving problems like monopolistic practices, unfair competition and counterfeiting.

Four days later, SAMR released its draft antitrust guidelines to rein in internet-based monopolies. It signalled policymakers’ heightened concerns over the growing power, influence and risks of digital platforms and their market practices in the economy. Monopolistic practices by internet platforms, such as demanding vendors to transact only on one platform exclusively, or providing differentiated prices to customers based on their shopping history and profiles, are to be outlawed, according to the guidelines.