Net firms, govt push antitrust rules

Concerns

However, the financial power gained by some internet giants has generated concerns about the negative effects they could have on the market, such as monopolies and unfair competition, copyright infringement and other issues.

For example, a probe started in December into the Alibaba Group－owner of Taobao, the nation's leading online marketplace－focused on the company's conduct when entering into "exclusive dealing agreements "with retailers.

The issue mainly refers to the company's practice of forcing retailers to choose either its platform or a rival site to sell their goods instead of being able to work with both, which potentially crowds out competitors.

A week after the probe started, Meituan, China's largest on-demand service platform for online food deliveries and restaurant orders, faced a lawsuit in a Beijing court for alleged abuse of market power.

The complainant claimed Meituan's decision to temporarily remove Alipay, the payment platform of Alibaba, as an option from its main app was an abuse of its dominant market position.

With market resources concentrated on leading companies, certain "risks and hidden dangers" have surfaced in the development of the online economy, according to a December commentary in People's Daily that was published in the wake of the developments.

Shi Jianzhong, vice-president of the China University of Political Science and Law and director of the school's Competition Law Research Center, said normalization of the anti-monopoly law in the internet sector will help push the healthy growth of the mutual drivers of competition and innovation.

"Maintaining competition and encouraging innovation are inseparable. Only by maintaining the order of market competition and promoting competition can the internet industry improve its financial efficiency, optimize its financial structure, improve consumer rights and help realize high-quality economic development," he said.

A string of efforts to protect consumer rights have surfaced since December. They have resulted in fines for companies including Alibaba, Tencent, Vipshop or subsidiaries for monopolistic behavior or failure to disclose planned mergers and acquisitions.

Song Jia, director of the machinery innovation center with the State-owned Assets Supervision and Administration Commission, said the antitrust measures are "not aimed at tripping up one leading firm but are made for the overall development of the industry and for industrial innovation".

Zhu, from the China University of Political Science and Law, agreed with that view. "Antitrust measures don't necessarily ban acquisitions or even encourage splitting up, but focus on bringing help to more players, and then boosting competition and innovation," he said.