Taobao asked to down shutters in Taiwan

E-commerce giant Alibaba Group Holding Ltd has been given six months to wind down its online marketplace Taobao's operations in Taiwan after it failed to apply for the permit required for a mainland company to do business there, Taipei authorities said on Monday.

An official at the Investment Commission said a fine of NT$240,000 ($7,890) has also been imposed on Taobao in what is the second case of an Alibaba operation falling foul of the permit rules for mainland companies this year. In March, Alibaba.com was told to leave the island within six months and fined NT$120,000 for a similar reason.

While the fine is small and Taiwan shoppers can continue to orders goods via Taobao's mainland base in the future, the permits glitch is an unwelcome headache for Alibaba as its seeks to grow business outside its mainland base.