The Beijing High People’s Court on Friday ruled that Alibaba, owner of the South China Morning Post, “abused its market dominance” and conducted the monopolistic tactic known as “ picking one from two”, which caused damage to JD.com’s business, according to a statement released on the same day by the Beijing-based online retailer.
JD.com hailed the court’s ruling, as it asserted that monopolistic practices, such as “picking one from two”, have hampered market competition and hurt the rights of brands, merchants and consumers.
That tactic, in which online merchants are forced to choose only one platform as their exclusive distribution channel, had been a common practice for years in China’s e-commerce market until it triggered an antitrust investigation against Alibaba in December 2020.
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China kicks off antitrust probes into Alibaba over alleged monopolistic practices
China kicks off antitrust probes into Alibaba over alleged monopolistic practices
Alibaba said it was informed of the judgment and respects the court’s ruling, according to a company spokeswoman on Friday.
The conclusion of that lawsuit comes amid the escalating rivalry between JD.com and Alibaba in the domestic e-commerce market, where the two firms are also trying to fend off younger challengers such as budget online retailer Pinduoduo, operated by PDD Holdings, and live-streaming shopping platform Douyin, owned by TikTok parent ByteDance.
The months-long inquiry by antitrust watchdog the State Administration for Market Regulation (SAMR) on Alibaba’s practices concluded in April 2021, when the company was slapped with a record 18.2 billion yuan fine and ordered to correct its misconduct.
At the time, the SAMR said Alibaba had “abused its dominant market position in China’s online retail platform service market since 2015” by forcing online merchants to exclusively open stores and take part in promotions on its domestic shopping platforms.
Earlier this week, both JD.com and Alibaba’s Taobao platform rolled out a “refund only” policy so consumers can keep the goods they had bought but later complained about – matching an option that Pinduoduo has had in place since 2021.
JD.com on Wednesday announced that it will nearly double the salary for frontline employees, including those in procurement and sales from January 1. Staff at its retail unit will receive an average raise of 20 per cent or more by early next year.
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