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Tech Monopolies Under Scrutiny

China Economic Weekly June 15, 2021

By NewsChina Updated Sept.1

On July 10, the State Administration for Market Regulation announced it had prohibited the merger of the Tencent-backed game streaming platforms Douyu and Huya for fear that it would create a monopoly. This is the first time the market regulator has halted a merger in the internet sector since the Anti-Monopoly Law came into effect in 2008. In April, the market regulator imposed a penalty of 18.23 billion yuan (US$2.8b) on e-commerce giant Alibaba for abusing market dominance. That was a case of punishment after the fact as it came after the deal was done. The Tencent merger ban is more likely a case of early intervention. These two cases involving the country’s two largest internet companies show that post-punishment and early intervention have become the main forms of anti-monopoly measures, even though early intervention is relatively rare in antitrust law enforcement.