China’s central bank called for comments on proposed regulations to tighten oversight of payment services offered by non-bank companies including Alibaba and Tencent, to deter anti-competitive behaviour in the sector.
A translated statement by the People’s Bank of China said the proposed rules define the scope of the “relevant market and the standards for determining market dominance”, and are intended to guide payment institutions to give more attention to product innovation and user services to better meet the diverse payment needs of consumers and the economy.
The regulations would allow the central bank to ask the State Council’s antitrust committee to stop a company from taking advantage of its market position, or break it up for failing to follow the principles of fair competition. The threshold for invoking regulatory scrutiny is for a non-bank payment institution to have half of the electronic payment market share.
Senior executives violating the regulations could be fined up to CNY500,000 ($77,361) after receiving an initial warning.
The deadline for feedback from the public is 19 February 2021.
Alibaba’s Alipay and Tencent’s WeChat Pay dominate online payments in China and have rapidly expanded into other financial and investment services, which prompted the regulator to examine their activities.Subscribe to our daily newsletter Back