Tencent's billionaire founder Pony Ma -- China's second richest man -- has met anti-monopoly regulators and agreed his firm will be "as compliant as possible", after rival tech giant Alibaba was battered by legal woes.
Tencent, which owns the super-app WeChat and a lucrative gaming empire, is the latest tech conglomerate to fall into the crosshairs of China’s regulators.
They have launched a blitz on apparent anti-competitive practices, threatening to slice up supersized firms whose reach now stretches into the daily finances of the public.
Tencent’s Ma, also known as Ma Huateng, said he would “actively cooperate with regulatory authorities and be as compliant as possible” during a news briefing late Wednesday on Tencent’s annual results, reported Chinese financial outlet Yicai.
Martin Lau, Tencent’s president and executive director, also said they had met the government several times to discuss anti-monopoly efforts and hoped to create a “healthy environment” to foster innovation.
“Tencent has throughout attached high importance to compliance,” he was quoted as saying.
The company’s shares slumped 5.1 percent in New York trade Wednesday, while its Hong Kong-listed stock was more than two percent lower.
The Chinese government is also discussing plans to establish a state-backed entity to oversee how big e-commerce and payment companies use data collected from millions of consumers, Bloomberg News reported Thursday citing people familiar with the matter.
China’s current data and privacy protection allows individuals to decide how companies can use their information, but enforcement is lax owing to a lack of transparency.
The move would be the latest by officials who are looking to reel in the country’s tech sector.
Authorities last year halted a record $34 billion initial public offering by fintech provider Ant Group, owned by Tencent’s nearest rival Alibaba.
They called in its billionaire founder Jack Ma and then opened an investigation into Alibaba business practices deemed anti-competitive.
Ant was then instructed to transform into a financial holding company that is subject to more regulatory restrictions.
Since then, the normally flamboyant and outspoken Ma has kept a low profile as the dragnet widens to include competitors.
Alibaba has been under pressure to divest its media assets as government officials are worried about its growing public influence, the Wall Street Journal reported last week.
In the past few months, regulators have also fined more than a dozen tech firms — including Tencent — for practices such as undisclosed acquisitions. Last week they summoned 11 tech firms for talks on cybersecurity.