Why is China tightening the noose for tech companies?

State Administration for Market Regulation (SAMR) – imposed a fine of CNY500,000 (US$77,141) on Tencent Holdings Ltd, a homegrown multinational technology conglomerate holding company. Tencent has come under the scanner on allegations of violations in its acquisition of China Music in 2016. Prima facie, it seems that the Chinese Government is in no mood to relent. In a mid-March meeting of Chinese Communist Party (CCP), the country’s President Xi Jinping – the man who has been dealing with any dissent with iron fist – declared that he will go after “platform” companies that amass data and market power. But that said, all this is surprising. For years, the Chinese government had supported the tech companies. At times, it was also alleged to have turned a blind eye to wrongdoings of these companies. And it happened during the leadership of Mr Jinping as well. So, what happened after the pandemic, that triggered this iron-fisted approach, would probably remain a mystery.

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