China's top market regulator on Tuesday proposed new rules to further curb anti-competitive behavior among big internet firms, causing a plunge in the stock market.
Details: The State Administration for Market Regulation (SAMR) announced on Tuesday that it would forbid business operators from faking statistics or information about their product orders, sales, and user reviews to mislead customers. Fabricating consumer views to hurt the reputations of rivals is also forbidden.
Other practices targeted by the new rules include using data, algorithms or other means to redirect web traffic from their rivals or create obstacles that would prevent customers from installing or running rival services.
Businesses that "seriously" violate the rules would be forced to publicly apologize and commit to fixing their issues, in addition to whatever punishment regulators decide, SAMR added.
SAMR said it could hire third-party institutions to audit data if an operator violates the rules aimed at preventing unfair competition.
The rules have not yet come into effect. SAMR is seeking public opinion on the draft regulations until September 15.
Context: Since last year, China has greatly strengthened the antitrust review of Chinese technology giants. In addition to the record fines imposed on Alibaba in April, the market regulator also imposed a series of fines or restrictions on tech giants including Tencent, Didi, Meituan, and Pinduoduo for suspected anti-competitive behavior.
Following the news, Tencent fell about 4%, while Alibaba fell 4.8%. JD.com fell 5.2% and Meituan fell 3.5%.