Alibaba to play central role in bolstering Hangzhou’s platform economy in fresh deal with local regulator

Hangzhou’s market regulator wants Alibaba to help the city entice more platform enterprises to make the eastern city their base of operations

The agreement was signed on Monday and announced the following day, nearly two years after Beijing’s tech crackdown culminated in a record fine on Alibaba

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An employee exits the Alibaba’s headquarters in Hangzhou on January 20, 2021. Photo: Bloomberg

Tracy Quin ShanghaiandAnn Caoin Shanghai

Published: 12:50pm, 15 Mar 2023

A new “cooperation” agreement between Hangzhou-based Alibaba Group Holding and the local market regulator gives the e-commerce giant a leading role in the city’s plans to bring in more internet firms amid the “high-quality and healthy development of platform economy”, a move that comes two years after the company was fined for monopolistic practices.

The Hangzhou Market Regulation Bureau and Alibaba, owner of the South China Morning Post, signed the deal on March 13, according to an article published to the bureau’s official WeChat account on Tuesday night. In January, the tech giant also inked a strategic cooperation agreement with the Hangzhou municipal authority.

Ma Chengrong, head of the regulatory agency, said during the signing ceremony that Alibaba has become one of Hangzhou’s biggest displays on the global stage. “The market supervision department is a witness to the development and growth of Alibaba, and the two parties have maintained good interaction and cooperation,” the bureau said in the article.

The agreement aims to implement decisions by “central, provincial, and municipal departments” to entice more platform enterprises to choose Hangzhou as their base. It also hopes for Alibaba to play a leading role in developing the province’s digital economy, while regulators will step up to provide more “scientific, precise, and intelligent” services.

Alibaba shares in Hong Kong gained 2.3 per cent by mid-day Wednesday.

Alibaba has experienced a rough ride over the past two years, since Beijing sought to clip the wings of the country’s Big Tech firms in the name of curbing the “disorderly expansion” of capital. Regulators opened an antitrust probe against the e-commerce giant in December 2020, weeks after quashing the initial public offering of the company’s fintech affiliate Ant Group.

The State Administration for Market Regulation slapped Alibaba with a record US$2.8 billion fine in 2021, setting a precedent for the government to use anti-monopoly rules to regulate the country’s tech giants.