- Alibaba Group has been hit with a record $2.8 billion fine in China.
- Billionaire founder Jack Ma’s tech empire has come under increased scrutiny from regulators.
- “Alibaba accepts the penalty with sincerity,” the company said in a statement.
- See more stories on Insider’s business page.
China on Saturday fined Jack Ma’s Alibaba Group a record $2.8 billion for abusing its leading market position.
Alibaba Group said in a statement that the penalty came from the State Administration for Market Regulation, which had been investigating it since December.
The fine was yet another sign that Chinese regulators have taken a more critical stance towards the tech empire built by Ma, one of the country’s wealthiest moguls.
Speaking at a conference last fall, Ma made negative comments about international financial regulations. Chinese President Xi Jinping then reportedly halted a planned $37 billion initial public offering by Ant Group, another Ma company.
The government on Saturday said Alibaba had used anti-competitive practices in its online retail market.
The fine was equal to about 4% of Alibaba’s annual sales in China, according to Xinhua News, a quasi-state media outlet. Local news reports said the company would be required for three years to complete “self-inspection” reports that it would then submit to the watchdog.
“Alibaba accepts the penalty with sincerity and will ensure its compliance with determination,” the company said Saturday in a press release.
It added: “To serve its responsibility to society, Alibaba will operate in accordance with the law with utmost diligence, continue to strengthen its compliance systems and build on growth through innovation.”
The company also published an open letter to customers, saying it had “fully cooperated” with the investigation.
“Alibaba would not have achieved our growth without sound government regulation and service, and the critical oversight, tolerance and support from all of our constituencies have been crucial to our development,” the company said.
The 18 billion yuan fine was a record for China, surpassing the $975 million fine issued to Qualcomm in 2015, as Reuters reported at the time.
Alibaba will hold a conference call on Monday to discuss the penalty.