China will implement tougher anti-monopoly rules and penalties over the next five years, according to new guidelines from the country’s cabinet, a signal that Beijing plans to tighten the screw further on the country’s harried businesses.
A regulatory crackdown on sectors ranging from tech to education has roiled markets in recent months.
Guidelines published late Wednesday by the Communist Party’s top decision-making body call for “centralised special rectification” - propaganda speak for further government intervention.
Sectors including finance, public health, education and food and drug manufacturing would be targeted, the guidelines said.
“We will strengthen law enforcement in key areas related to the vital interests of the people,” the document added.
Officials will “actively” work on improving laws in areas including national security, technology and anti-monopoly rules, it said.
The guidelines also promise to introduce “good laws and good governance” on artificial intelligence, big data and cloud computing - sectors that have been allowed to grow unchecked in recent years.
The document warned that Beijing will hike penalties for those who violate anti-monopoly laws, including by issuing “a lifelong prohibition on entry” for the worst rule-breakers.
Officials also promised better protections for industrial whistleblowers.
China recently unveiled sweeping new regulations for a range of industries that have rattled investors.
One rule forcing private tutoring companies to turn non-profit wiped out more than $70 billion from their balance sheets. Tech firms have also been battered as regulators tighten the leash citing data security and antitrust concerns.
And gaming companies recently saw shares plummet over fears they could be next in the sights of regulators.
The blueprint released Wednesday “suggests that the restructuring related to anti-monopoly will be a long-lasting policy direction,” Ken Cheung Kin Tai, an analyst at Japan’s Mizuho Bank, said in a research note.
Published in The Express Tribune, August 13th, 2021.
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