Beijing (PingWest)—China's market regulator is preparing a substantial fine for Tencent as part of its sweeping antitrust clampdown on the country’s internet giants, Reuters reported, citing people with direct knowledge of the matter said.
According to the report, Tencent will be punished for failing to properly report past acquisitions and investments for antitrust reviews with a maximum fine of 500,000 yuan per case. The total fines will reach 10 billion yuan ($1.54 billion).
The State Administration for Market Regulation’s (SAMR) investigation partly focused on its Nasdaq-listed subsidiary Tencent Music Entertainment (TME). In addition to fines, TME, China's answer to Spotify, may be required to give up exclusive music rights, and may even be forced to sell the acquired Kuwo and Kugou music apps.
However, the Chinese tech giant's core businesses, video games and WeChat, are likely to remain intact, said the report.
"The attitude from the regulator is that unlike Alibaba you are not the biggest target here, but it would be impossible not to penalize Tencent now that the campaign is in action," said one of the people.
SAMR said this week it is investigating Tencent-backed Meituan over claims the food delivery giant forced vendors to use their platform exclusively, the same offense Alibaba was penalized for.