China to deepen scrutiny of internet industry

The head of China’s Ministry of Industry and Information Technology (MIIT) Xiao Yaqing announced that the Ministry will work on the short-term to fix problems with the digital economy. According to Yaqing, specific measures are expected to promote a fair and orderly market environment. The MIIT has already started to address poor data security practices that force users to accept personalised services and blocks or restricts access to competing services. This is a common practice in China. As a result, users are locked into specific app ecosystems. Tech companies have been responding to the MIIT regulatory pressure by opening up their platforms. Recently, WeChat, China’s most popular social media platform, allowed users to open links from competing platforms shared in one-to-one-chats. Also, Alibaba started authorizing users to use WeChat Pay on several of its platforms, including its platforms related to food delivery and video-streaming. Before, Alibaba only allowed payments through Alipay which is WeChat Pay’s main competitor. The MIIT has also pledged support for SMEs by avoiding anticompetitive behaviour.