Platforms to be under better watch
Normalization, predictability of policies seen as key to sector's development
China's supervision of the platform economy will become normalized and predictable with more targeted efforts to guide companies into compliance, and will make the sector's healthy development a priority in the long term, said leading antitrust experts and sources close to the industry regulator on Wednesday.
These comments were made as several high-level conferences, including a symposium held by the country's top political advisory body on Tuesday, have recently pledged support for the development of the country's platform economy companies and digital economy, which have been widely seen as an easing signal of the country's regulations for the tech sector.
"Over the past year and more, authorities have conducted intensive and special rectifications of improper behaviors on the platform economy and have achieved the desired effect of a fairer market environment. Now, it is time for China to come back to normalized and predictable supervision in the sector," said Wang Xianlin, a member of the expert advisory group of the State Council's anti-monopoly commission.
"To be normalized is mainly to make regulatory efforts routine and avoid fragmented supervision. Fragmented supervision is basically ignoring illegal or improper behavior during the initial development stage of a sector but suddenly starting to regulate it," said Wang, who is also director of the Center for Competition Law and Policy at Shanghai Jiao Tong University.
He described such a supervisory process as one's health management. "When you are sick, of course, you need to go to a doctor or even an emergency room to get cured. After targeted treatment, you are expected to return to daily health management like exercising to keep healthy," he said.
"For not only China but also the rest of the world, supervision on the platform economy is only a tool. The ultimate goal is to drive the sector to be more healthy in the long term," said Wang.
"More targeted efforts will be made to steadily promote the rectification of improper market behavior by large platform companies to guide them to develop in compliance," he said.
His words echo a source close to the industry regulator. The source told China Daily that several ministries including the Ministry of Industry and Information Technology continued regular and targeted rectifications of improper market behavior by tech giants.
The MIIT, for instance, sent a working group earlier this year to one of the country's tech titans, to inspect the company's problems with personal information security and other behavior that has harmed consumer interests, the source said.
On Friday, the State Administration for Market Regulation, the nation's top market regulator, also filed a case against the academic database China National Knowledge Infrastructure for suspected monopolistic behavior.
"Filing a case on CNKI is a major concrete move of normalized supervision and sent a clear signal of compliance necessity to platform companies, which from the market side, will have a more reliable expectation of the rules of the law," said Shi Jianzhong, a member of the expert advisory group of the State Council's antimonopoly commission and vice-president of China University of Political Science and Law, in a note.
"With normalized antitrust supervision, the environment of the platform economy will be purified so that it can better play its role in promoting technological innovation, facilitating people's lives and prospering the economy," he said.
Leading foreign brokerages and investors are re-examining the investment value of Chinese internet and technology companies. JPMorgan upgraded on Monday a slew of Chinese internet and tech companies including Alibaba Group, Tencent Holdings, NetEase Inc and Meituan to overweight, and JD, Bilibili and several other Chinese companies from underweight to neutral.
