Alibaba Group Chair Jack Ma during a 2019 conference in Hangzhou, Zhejiang Province of China. Photo: VCG/VCG via Getty Images)
China is investigating Alibaba Group on suspicion of monopoly, Bloomberg reported Wednesday.
Why it matters: The probe comes as Chinese regulators seek to rein in some of the country's largest tech companies.
- Regulators have also summoned Alibaba affiliate, Ant Group Co., to discuss fair competition and consumer rights, per Bloomberg.
Details: An investigation was opened into Alibaba's "choosing one from two" practice, the State Administration for Market Regulation said, according to Reuters.
- This practice requires merchants to sign "exclusive cooperation pacts preventing them from offering products on rival platforms," Reuters notes.
- Ant said in a statement that it will study and comply with all requirements, per Bloomberg.
The big picture: The investigation is also the latest sign of trouble for Alibaba co-founder Jack Ma.
- In November, China abruptly pulled the plug on Ant Group's IPO in November in an apparent rebuke to Ma, Ant's controlling shareholder.
The bottom line: "Once hailed as drivers of economic prosperity and symbols of the country’s technological prowess, Alibaba and rivals like Tencent Holdings Ltd. face increasing pressure from regulators after amassing hundreds of millions of users and gaining influence over almost every aspect of daily life in China," Bloomberg wrote.
Go deeper: How Jack Ma scuttled Ant Group’s planned $35 billion IPO