Photo illustration of the Tencent Music Entertainment (TME) logo, a Chinese company that develops music streaming services.
Pavlo Gonchar | SOPA images | LightRocket via Getty Images
The Chinese antitrust regulator has ordered Tencent to waive its exclusive music licensing rights and fined the company for anti-competitive conduct, while Beijing continues to crack down on its internet giants at home.
The State Administration for Market Regulation (SAMR) on Saturday fined the company 500,000 yuan ($77,141) for violations in its 2016 acquisition of China Music.
Following that acquisition, Tencent will own more than 80% of exclusive music library resources, giving the company an advantage over its competitors because it is able to negotiate more exclusive agreements with copyright holders, SAMR said in a statement.
The competition watchdog ordered Tencent and its subsidiaries to ensure fair competition by relinquishing its exclusive music rights within 30 days, and to end the requirements for copyright holders to offer the company better terms than competitors, such as high advances .
Tencent will be required to report to the SAMR every year for three years on its progress, according to the statement, and the antitrust regulator will strictly monitor its implementation under the law.
In response, Tencent said it will abide by the regulator’s decision and “meet all legal requirements, fulfill our social responsibilities and contribute to healthy competition in the marketplace.”
It comes as Beijing continues to tackle its domestic technology companies that have grown into some of the world’s most valuable companies. The crackdown in recent months has ranged from last year’s suspension of Ant Group’s $34.5 billion IPO to Alibaba’s $2.8 billion antitrust fine.
In April, the SAMR called on 34 companies, including Tencent and ByteDance, and ordered them to conduct self-inspections to comply with anti-monopoly rules.
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