Shares of Chinese companies, including Alibaba Group Holding Ltd (NYSE:BABA), Baidu Inc (NASDAQ:BIDU) and Pinduoduo Inc (NASDAQ:PDD), are trading lower Friday after Chinese regulators pushed for food delivery platforms to cut their fees, which sparked a selloff in delivery platform Meituan and raised regulatory concerns in the country.
According to a Bloomberg report, China issued new guidelines asking delivery platforms to reduce charges for restaurants in order to lower business costs.
Online food delivery platforms were also reportedly told to give preferential fees to restaurants in regions hit hardest by the COVID-19 pandemic.
China has spent most of the year cracking down on anti-monopolistic practices, cybersecurity businesses and more. The new guidelines suggest that China may not be done increasing regulation on big tech.
Alibaba should provide further details on the impacts of the yearlong regulation on its business when the e-commerce company reports its quarterly financial results before the market opens on Feb. 24. Baidu is set to report its quarterly results on March 1.
BABA, BIDU, PDD Price Action: At publication time, Alibaba was down 5.44% at $117.65, Baidu was down 5.21% at $157.73 and Pinduoduo was down 7.41% at $55.18.
Photo: courtesy of Alibaba.
