China draws up first antitrust rules to curb power of tech companies

China draws up first antitrust rules to curb power of tech companies

Draft legislation marks latest wing-clipping of digital platforms after halted Ant IPO

China’s market regulator has taken its first major step towards curbing the monopolistic power of its tech giants, drawing up draft antitrust rules that have sent shares in companies such as Alibaba, Tencent and food delivery giant Meituan tumbling in Hong Kong.

The move, which will see China attempt to define for the first time what constitutes anti-competitive behaviour in the tech sector, is the latest wing-clipping of high-flying digital platforms in the country after Beijing suspended the blockbuster IPO of Ant Financial last week.

Meituan’s shares fell more than 11 per cent following the news, while Alibaba’s and Tencent’s fell more than 5 and 4 per cent respectively.

Until now, Chinese regulators have taken a relatively hands-off approach to antitrust, even as authorities in the US and Europe launched inquiries and investigations into Amazon, Facebook, Google and others.