Photographer: Marlene Awaad / Bloomberg
Photographer: Marlene Awaad / Bloomberg
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China has just imposed a record fine on Alibaba Group Holding Ltd. The company thanked the government and investors breathed a sigh of relief.
Alibaba’s US depositary receipts rose 9.3% in New York on Monday, the biggest jump in nearly four years. For Jack Ma, the founder of the e-commerce giant, this meant his fortune increased by $ 2.3 billion to $ 52.1 billion, according to the Bloomberg Billionaires Index.
The $ 2.8 billion fine is less severe than some investors feared and is based on just 4% of the company’s 2019 domestic sales, far less than the maximum 10% allowed by Chinese law. While the internet giant will have to change its way of doing business, its vice chairman said regulators will not impose a radical overhaul of its e-commerce strategy and declared its CEO Alibaba ready to move forward.
“Alibaba would not have achieved our growth without proper government regulation and service, and the critical scrutiny, tolerance and support of all of our constituencies has been critical to our development,” the company said in an open letter. “For this we are full of gratitude and respect.”
Also read: Record Alibaba Great shows China’s Big Tech cannot fight back
Ma, who was the richest person in China until last year, has lost billions since his country’s regulators launched an anti-monopolistic campaign, halting the IPO of his Ant Group Co. payment company just two days before it was due to go public. to go. He is now China’s third richest person, after Zhong Shanshan of bottled water company Nongfu Spring Co. and Pony Ma from Tencent Holdings Ltd.
Separately, the central bank of China ordered Ant to become a financial holding company that will be regulated more like a bank. The move, announced Monday, will have far-reaching implications for the company’s growth and its ability to proceed with an IPO. Alibaba shares opened 3.4% higher in Hong Kong on Tuesday.
– With the help of Coco Liu
Updates to include Ant revision and inventory movement in the last paragraph