People’s Bank of China has outlined its definitions of monopoly among third-party online payments for the first time, according to SCMP. Any nonbank service provider with half of the market for online transactions, or two entities with a combined two-thirds share, could be subject to antitrust investigations.
- Three providers with three-quarters of the market would also set off the antitrust alarm.
- A nonbank service provider with less than 10% market share that operates in a business with two or three dominant players shall be excluded from antitrust probes by regulators.
- The proposed rules, which are open to public feedback until February 19, are the most details of the financial regulator’s plan to curtail China’s e-payment market.
- The draft by the central bank is part of the Chinese government’s efforts to rein in the unchecked growth of nonbank service providers in the payments market.
- The rules are also created to prevent “regulatory arbitrage and omissions” and allow antitrust regulators to warn potential ‘monopolisers’ of their breaches.
- The draft regulation also empowers the central bank to conduct on-site inspections of payment service institutions.
- The central bank, nonetheless, did not define how it would measure the market share for nonbank third-party payment.
China leads in big tech lending with a US$29 trillion transaction volume.