<p>Chinese authorities announced on Friday a fine of 7.12 billion yuan ($984 million) for Ant Group for violating laws concerning consumer protection and corporate governance, one of the largest ever fines for an internet company in China.</p>.<p>The penalty ends a years-long regulatory overhaul of the fintech company.</p>.<p>The People's Bank of China (PBOC), which has been driving the revamp at Ant after its $37-billion IPO was scuttled in late 2020, announced the penalty in a statement published on its website.</p>.<p>The penalty will help pave the way for the fintech firm to secure a financial holding company license, seek growth, and eventually, revive its plans for a stock market debut.</p>.<p>For the broader technology sector, the fine marks a key step towards the conclusion of China's bruising crackdown on private enterprises, that began with the scrapping of Ant's IPO and which has subsequently wiped billions off the market value of several companies.</p>.<p>Reuters reported earlier, citing sources, that the PBOC intended to unveil the fine as early as Friday.</p>.<p>Ant did not immediately respond to requests for comment.</p>.<p>Hong Kong-listed shares in Ant's affiliate, e-commerce titan Alibaba Group, rose 3.3 per cent in premarket trading after the PBOC's announcement.</p>.<p>Moves by the Chinese government to "finalise penalties, clarify its expectations, and draw clear compliance boundaries are key to stabilising private sector confidence," said Rukim Kuang, founder of Beijing-based Lens Consulting.</p>.<p><strong>'Disorderly expansion of capital'</strong></p>.<p>Founded by billionaire Jack Ma, Ant undertakes payment processing, consumer lending and insurance products distribution, among other businesses. In mid-2020, before its IPO was pulled, it was valued by some investors at more than $300 billion.</p>.<p>Since April 2021, Ant has been formally undergoing a sweeping business restructuring, which includes turning itself into a financial holding company that would subject it to rules and capital requirements similar to those for banks.</p>.<p>The announcement of the fine comes soon after China's ruling Communist Party appointed central bank Deputy Governor Pan Gongsheng as the bank's party secretary, a move two policy sources told Reuters would be a prelude to appointing him governor.</p>.<p>He is one of the main regulatory officials overseeing Ant's revamp and has attended several meetings with the company about the fine and the revamp, according to the sources.</p>.<p>The National Financial Regulatory Administration (NFRA), a new government body under the State Council, is now the primary regulator to grant Ant the license, sources familiar with the matter said.</p>.<p>The NFRA did not immediately respond to a Reuters request for comment. The PBOC did not immediately respond to a request for comment on Pan's role.</p>.<p><strong>Penalty follows Ma's return to China</strong></p>.<p>The sources had earlier said that the fine had been revised to at least 8 billion yuan. Reuters reported in April that Chinese regulators were considering fining Ant about 5 billion yuan, a lower sum than what they initially had in mind.</p>.<p>Ant's fine is the largest regulatory penalty imposed on a Chinese internet company since ride-hailing major Didi Global was fined $1.2 billion by China's cybersecurity regulator last year.</p>.<p>Alibaba was fined a record 18 billion yuan in 2021 for antitrust violations.</p>.<p>Ant's penalty comes at a time Chinese authorities are keen to boost private sector confidence as the $17 trillion economy struggles to recover despite the lifting of zero-Covid curbs earlier this year.</p>.<p>It also follows the return to China of Ma earlier this year after spending many months overseas. Ma, who also founded Alibaba, withdrew from public view in late 2020 after giving a speech criticising China's regulatory system, an event widely regarded as a trigger for the crackdown on industry.</p>.<p>He previously owned more than 50 per cent of the voting rights at Ant, but in January it said he would give up control of the company as part of the revamp.</p>.<p><em>($1 = 7.2439 Chinese yuan renminbi)</em></p>
<p>Chinese authorities announced on Friday a fine of 7.12 billion yuan ($984 million) for Ant Group for violating laws concerning consumer protection and corporate governance, one of the largest ever fines for an internet company in China.</p>.<p>The penalty ends a years-long regulatory overhaul of the fintech company.</p>.<p>The People's Bank of China (PBOC), which has been driving the revamp at Ant after its $37-billion IPO was scuttled in late 2020, announced the penalty in a statement published on its website.</p>.<p>The penalty will help pave the way for the fintech firm to secure a financial holding company license, seek growth, and eventually, revive its plans for a stock market debut.</p>.<p>For the broader technology sector, the fine marks a key step towards the conclusion of China's bruising crackdown on private enterprises, that began with the scrapping of Ant's IPO and which has subsequently wiped billions off the market value of several companies.</p>.<p>Reuters reported earlier, citing sources, that the PBOC intended to unveil the fine as early as Friday.</p>.<p>Ant did not immediately respond to requests for comment.</p>.<p>Hong Kong-listed shares in Ant's affiliate, e-commerce titan Alibaba Group, rose 3.3 per cent in premarket trading after the PBOC's announcement.</p>.<p>Moves by the Chinese government to "finalise penalties, clarify its expectations, and draw clear compliance boundaries are key to stabilising private sector confidence," said Rukim Kuang, founder of Beijing-based Lens Consulting.</p>.<p><strong>'Disorderly expansion of capital'</strong></p>.<p>Founded by billionaire Jack Ma, Ant undertakes payment processing, consumer lending and insurance products distribution, among other businesses. In mid-2020, before its IPO was pulled, it was valued by some investors at more than $300 billion.</p>.<p>Since April 2021, Ant has been formally undergoing a sweeping business restructuring, which includes turning itself into a financial holding company that would subject it to rules and capital requirements similar to those for banks.</p>.<p>The announcement of the fine comes soon after China's ruling Communist Party appointed central bank Deputy Governor Pan Gongsheng as the bank's party secretary, a move two policy sources told Reuters would be a prelude to appointing him governor.</p>.<p>He is one of the main regulatory officials overseeing Ant's revamp and has attended several meetings with the company about the fine and the revamp, according to the sources.</p>.<p>The National Financial Regulatory Administration (NFRA), a new government body under the State Council, is now the primary regulator to grant Ant the license, sources familiar with the matter said.</p>.<p>The NFRA did not immediately respond to a Reuters request for comment. The PBOC did not immediately respond to a request for comment on Pan's role.</p>.<p><strong>Penalty follows Ma's return to China</strong></p>.<p>The sources had earlier said that the fine had been revised to at least 8 billion yuan. Reuters reported in April that Chinese regulators were considering fining Ant about 5 billion yuan, a lower sum than what they initially had in mind.</p>.<p>Ant's fine is the largest regulatory penalty imposed on a Chinese internet company since ride-hailing major Didi Global was fined $1.2 billion by China's cybersecurity regulator last year.</p>.<p>Alibaba was fined a record 18 billion yuan in 2021 for antitrust violations.</p>.<p>Ant's penalty comes at a time Chinese authorities are keen to boost private sector confidence as the $17 trillion economy struggles to recover despite the lifting of zero-Covid curbs earlier this year.</p>.<p>It also follows the return to China of Ma earlier this year after spending many months overseas. Ma, who also founded Alibaba, withdrew from public view in late 2020 after giving a speech criticising China's regulatory system, an event widely regarded as a trigger for the crackdown on industry.</p>.<p>He previously owned more than 50 per cent of the voting rights at Ant, but in January it said he would give up control of the company as part of the revamp.</p>.<p><em>($1 = 7.2439 Chinese yuan renminbi)</em></p>