At the beginning of the new year, the illegal mergers and acquisitions of Internet platform giants were again "carpeted" by antitrust regulators.
On January 5, the State Administration for Market Regulation (SAMR) announced 13 penalty decisions for failure to declare illegal concentrations of undertakings in the Internet sector.
CbN found that the 13 cases involved 9 cases of Tencent, 2 ali, 1 each of JD.com and Bilibili, and these companies were issued a single top-level fine of up to 500,000 yuan. Among them, Tencent's fines ranked first, totaling 4.5 million yuan.
"Concentration of undertakings review" is the prior control of the anti-monopoly law enforcement agency over the merger, acquisition and other concentration of undertakings. According to Article 21 of the Anti-Monopoly Law, where a concentration of undertakings meets the reporting standards prescribed by the State Council, the undertakings shall make a declaration in advance, and if they do not, they shall not implement the concentration.
According to the notice of the State Administration for Market Regulation, the above-mentioned cases all violated this provision, that is, they constituted a situation of "failing to declare the illegal implementation of the concentration of undertakings in accordance with the law", but "did not have the effect of eliminating or restricting competition".
Chen Bing, professor at Nankai University Law School and director of the Competition Law Research Center, said in an interview with First Finance and Economics that the one-time announcement of 13 cases of concentration of undertakings against platform giants shows that regulators continue to pay attention to the problem of disorderly expansion of capital in the field of platform economy, platforms using mergers and acquisitions to restrict competition, suspected monopolies and other issues, and is also a continuation of strengthening anti-monopoly law enforcement since last year.
"But it should not be simply understood that in 2022, the anti-monopoly regulatory authorities will carry out 'storm- type' law enforcement in the field of platform economy, and this 'carpet' announcement of a number of cases in the Internet field is more of a routine behavior to clean up and summarize the past work." According to the statement of the State Administration for Market Regulation at the end of 2021, in 2022, whether it is the platform economy or the field of people's livelihood, anti-monopoly supervision will enter a period of rule of law, normalization and specialization. Chen Bing said.
From the perspective of timeline, the occurrence of illegal transactions in these 13 cases can be traced back to 2015, and there are many cases that occurred between 2015 and 2020, the most recent of which was on November 26, 2020, when Tencent increased its capital by 10%, holding a total of 12.175% of the equity of Jiu Xiao'er and obtaining its joint control.
It is worth noting that in November 2020, the State Administration for Market Regulation clarified for the first time in the Anti-monopoly Guidelines for the Platform Economy (Draft for Comment) that Internet enterprises involved in the VIE structure should declare the concentration of business operators in accordance with the law, while tencent-controlled Yuwen Group was also investigated by the anti-monopoly law enforcement agency on November 4 of that year for acquiring Xinli Group for "failing to declare according to law".
"On the one hand, this shows that the company's vigilance against the change of control caused by a small proportion of equity acquisitions is low, on the other hand, the relevant enterprises know that they cannot do it, and it also shows that the top penalty of 500,000 yuan has limited binding force on the platform giant." Liu Xu, a special researcher at the Institute of National Strategic Studies of Tsinghua University, told First Finance.
In addition to the above-mentioned cases, the cases involving Tencent include the case of Tencent and Harmony Automobile establishing a new joint venture, the case of Tencent's acquisition of the equity of Youhu Technology, the case of Tencent's acquisition of the equity of Yonghui Yunchuang, and the case of hisense Network Technology and Tencent setting up a joint venture. The cases involving the Ali family include 2 cases in which Ali Venture Capital acquired the equity of Pan Asia Information and Communications with Zhengzhou Xunjie and Guizhou Radio and Television.
Liu Xu believes that the cooperation between Tencent and Qingdao Hisense Network Science and Technology, and ali's participation in Guizhou Panya, these two cases involve local smart government service business and need special attention.
He said that when local governments carry out such digital government services and government cloud services, they generally use the government procurement process of bidding and bidding, but there is also a model in which local state-owned enterprises and private enterprises form joint ventures to undertake related business, which may lead to preferential treatment for private enterprises participating in the joint venture in related services and equipment procurement, which will affect fair competition.
According to the Disclosure of the State Administration for Market Regulation, on June 15, 2015, Alibaba Venture Capital, Zhengzhou Xunjie, Guiyang Radio and Television, etc. signed the "Capital Increase Agreement", and Zhengzhou Xunjie, Ali Venture Capital and Guiyang Radio and Television acquired 41.67%, 25% and 25% of the equity of Pan Asia Information and Communications by way of subscription and capital increase, and obtained joint control, which belongs to the concentration of undertakings provided for in Article 20 of the Anti-Monopoly Law.
According to the enterprise investigation information, Alibaba Venture Capital was registered and established in Hangzhou, Zhejiang Province in 2006, and the final controller is Alibaba Group Holdings Limited. The corporate legal person of Zhengzhou Xunjie is Duling, the chairman of Foxconn Financial. Guiyang Radio and Television is 100% owned by the Guiyang Finance Bureau.
In this case, Ali Venture Capital, Zhengzhou Xunjie and Guiyang Radio and Television were all given administrative penalties of 500,000 yuan.
In addition, from the perspective of mergers and acquisitions and investment fields of platform companies such as Tencent, Alibaba, JD.com, bilibili, etc., it covers retail, medical, automotive, IT intelligent information systems, animation, picture editing and other fields, and there are several acquisitions and investments for start-ups by platform giants.
"Similar to Bilibili's investment behavior in the keying software macaron, it can indeed provide better application scenarios and user expansion space for the latter, and stimulate its innovation vitality." However, if the relevant cooperation is exclusive, it will squeeze the market space of similar products of other innovative enterprises, which is why platform giants should cooperate with anti-monopoly supervision in a timely manner when expanding the ecosystem. ”
Chen Bing also believes that at present, the platform giants' venture capital behavior for multi-field start-ups and unicorn companies occurs frequently, which brings regulatory pressure. From the perspective of anti-monopoly law enforcement, the "anti" is not the merger and acquisition itself, but the "anti" procedural violation that has not been declared in accordance with the law and the suspected monopoly and restriction of competition through merger and acquisition.