Alibaba, JD.com Shares Fall After Chinese Government Issues Fines
Alibaba and JD.com are paying for price complaints — with fallen stock prices.
The Chinese government, which continues to try to tighten its control over China’s growing tech industry, fined the two companies — along with a third firm VipShop Holdings — on charges of misreporting prices and offering false promotions, among other things, after receiving consumer complaints.
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Share prices for all three firms fell Thursday as a result, nearly 2 percent for Alibaba and JD.com and about 0.30 percent for VipShop.
Some shoppers believe the platforms inflated prices last month, only to lower them during November’s Singles’ Day to make it appear as though they were receiving a discount.
Each firm was fined 500,000 yuan, or a little more than $76,000, and has 60 days to appeal. Alibaba and JD.com could not be reached for comment.
Meanwhile, China’s e-commerce industry continues to grow. Alibaba, China’s largest online shopping platform, generated more than $74 billion in revenues during November’s shopping event, or nearly double the amount from the previous year. JD.com, the second largest e-commerce player in China, had $41 billion in sales during the event.
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