Alibaba antitrust investigation: what is the ‘picking one from the two’ practice that triggered an official probe?
- Chinese regulators will look into the ‘picking one from two’ practice as part of their probe into Alibaba Group Holding over suspected monopolistic practices
- The tactic, in which online merchants are forced to pick only one platform as their exclusive distribution channel, is widespread in China’s e-commerce market
The move by China’s antitrust regulator to launch an investigation into the alleged monopolistic practices of Alibaba Group Holding will be the first time authorities have cracked down on the so-called “picking one from two” practice, despite its years-long use in the e-commerce market.
The tactic, in which online merchants are forced to choose only one platform as their exclusive distribution channel, is widespread in China, especially during the shopping festivals such as November 11.
Under the scheme, if a seller lists on a competitor’s platform, the operator may punish it by blocking traffic to the merchant or yanking products offline.
Everyone knows the issue of choosing one from two, and the authorities know it too,
In November, SAMR, the country’s cyberspace administration and tax bureau summoned the country’s 27 e-commerce groups, including Alibaba, JD, Meituan and Pinduoduo, and ordered them to halt the practice, but the probe into Alibaba Group is a new step.