Alibaba Group signage is seen during the company’s 11.11 Singles’ Day global shopping festival at their headquarters in Hangzhou, Zhejiang province, China, November 11, 2020.
Aly Song | Reuters
China’s State Administration for Market Regulation said through official online channels Thursday it has opened an investigation into Alibaba over monopolistic practices. The primary issue named was a practice that forces merchants to choose one of two platforms, rather than being able to work with both.
The news comes on the heels of an increasing — and largely unexpected — push by Chinese authorities to rein in their biggest tech firms through regulatory action.
An Alibaba representative did not immediately respond to a CNBC request for comment. Bloomberg first reported the news, which was announced by Chinese state news agency Xinhua.
Hong Kong-listed shares of Alibaba dropped more than 6% shortly after markets opened Thursday.
New York-traded shares of Alibaba fell more than 3% in after-hours trading on Wednesday.
Separately, Alibaba-affiliate Ant announced it received a notice Thursday from regulators for a meeting. Last month, regulators abruptly suspended the financial technology giant’s massive initial public offering just days before the planned listing in Hong Kong and Shanghai.
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