Trip.com Group Limited (NYSE: TCOM), also listed as TRIP.COM-S (HKEx: 09961), has been fined and had assets confiscated totaling 5.179 billion yuan by the State Administration for Market Regulation (SAMR) for abusing its dominant market position to implement monopolistic practices, and has been ordered to carry out comprehensive rectification.
Since China launched its anti-monopoly regulation of the platform economy, the SAMR has disclosed several monopoly cases in the internet sector. In April 2021, Alibaba (NYSE: BABA), also listed as Alibaba-W (HKEx: 09988), was fined 18.228 billion yuan for its long-standing "choose one from two" monopolistic behavior towards merchants in the domestic online retail market. This was the first top-level heavy penalty in China's platform economy sector for abuse of a dominant market position ("choose one from two") targeting a platform's core business. Prior to this, internet anti-monopoly penalties were mostly small fines for failure to report mergers and acquisitions, which did not touch upon the core business model of platforms.
In October of the same year, Meituan Waimai was found to have implemented a "choose one from two" policy for its merchants, resulting in a fine of 3.442 billion yuan, plus the return of 1.289 billion yuan in exclusive cooperation deposits from merchants. In 2021, Tencent Music (NYSE: TME), also listed as TME-SW (HKEx: 01698), was fined 500,000 yuan for hoarding exclusive copyrights of top record labels, signing agreements to restrict sub-licensing, raising procurement costs for NetEase Cloud Music, and limiting fair competition in the music market. It was eventually ordered to cancel all exclusive copyright agreements and restore normal circulation in the copyright market.
The three cases of Alibaba, Meituan, and Trip.com represent a story of escalating penalties. The penalty for Alibaba mainly consisted of a 18.228 billion yuan fine. For Meituan, it became a combination of a 3.442 billion yuan fine and the return of 1.289 billion yuan in merchant deposits. This time, Trip.com faced a three-pronged approach for the first time: a fine of 3.521 billion yuan, confiscation of illegal income of 1.658 billion yuan, and the return of 122 million yuan in merchant reserves. In essence, regulators are now settling old accounts, forcing companies to disgorge all profits made through illegal means.
While some may believe that fines of billions or tens of billions are just a drop in the bucket for these internet giants, the real impact lies not in the fines themselves but in the rectification requirements attached to them. Forcing a halt to "choose one from two" and abolishing hard rules like "lowest price on the platform" directly dismantles the monopoly barriers that platforms built using their traffic advantages. Looking back at the five years of anti-monopoly regulation in the platform economy since 2021, the core message is clear: the era of making easy money through traffic dominance is over. The more advanced the technology, the more crucial it is to adhere to compliance standards. For all platforms, returning to the essence of service and creating value steadily is the right path to long-term development.
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