Photo taken on Oct. 15, 2020 shows the headquarters of Ant Group in east China's Hangzhou city.Photo:Xinhua

Chinese regulators on Friday announced a fine of 7.12 billion yuan ($993.54 million) on Ant Group, while declaring an end to the rectification of most of the outstanding problems in the financial business of platform enterprises that started in November 2020.

Experts noted that the fines aim to further regulate the nation's platform economy and create a healthy and sustainable development for the industry to progress, rather than suppression.

In a statement, the China Securities Regulatory Commission (CSRC) said that Ant Group and its subsidiaries have violated regulations in areas such as cor-porate governance, financial consumer protection and anti-money laundering. In addition to the fine, Ant Group was also asked to suspend illegal financial services and compensate consumers. 

Among the fined subsidiaries under the Ant Group, Alipay was fined around 3 billion yuan by regulators for involvement in seven illegal acts. Relevant executives and personnel involved in the corresponding violations in Alipay were given fines ranging from 50,000 yuan to 1.48 million yuan.

Ant Group said in a statement on Friday night that it has been conducting business rectification proactively since 2020 and the company has now com-pleted related work on the rectification.

"We will comply with the terms of the penalty in all earnestness and sincerity and continue to further enhance our compliance governance," the company said, adding that it will continue to pursue innovation with a firm commitment to integrity, and continue to enhance its R&D capabilities to better serve and create greater value for the physical economy, especially for consumers and small businesses."

The CSRC statement stressed that authorities have been guiding major plat-form enterprises, including Ant Group and Tencent, to fully rectify illegal oper-ations of their financial businesses since November 2020, adding that the rec-tification of major problems has been completed, and the regulatory focus will be shifted from the centralized rectification to normalized supervision. 

Tenpay under Tencent was fined nearly the same amount as Alipay on Friday as well. 

Chinese regulators are taking strong measures to address previous illegal activ-ities and violations. Companies such as Ant Group and WeChat Pay, operating as third-party payment providers, have engaged in questionable practices and pushed regulatory boundaries, resulting in problems such as misleading con-sumers and infringement of rights. Moving forward, stricter regulation is needed to oversee these financial innovations and business formats, ensuring compliance and protecting consumer rights, Wang Peng, a research fellow at the Beijing Academy of Social Sciences, told the Global Times on Friday.

The issuance of the fine shows that the previous illegal acts of Ant Group have already been investigated with corresponding rectification being implemented, signaling a positive sign for the future development of the industry, Liu Dingding, an independent tech analyst, told the Global Times on Friday. 

Wang said the penalty is a "symbolic event" for the private firms as it marks a phased conclusion of months or even years of investigations, paving the way for a sound and stable path for the development of platform enterprises.

Liu added that further work for the Ant Group's suspended IPO might be able to progress following the conclusion. 

Wang also pointed out that regulatory authorities primarily aim to encourage, support, and guide legitimate innovations that benefit economic and social development. In the event of any issues arising, penalties are applied, followed by corrective measures, enabling businesses to resume their operations smoothly and promote innovation that serves the real economy more effec-tively.

US-listed Chinese tech stocks opened with a surge on Friday, with shares of Alibaba increasing 5.88 percent as of press time to $88.46 per share. Stocks for JD.com and Baidu also rose nearly 2 percent. 

Moving forward, the CSRC noted that China's financial regulators will further implement supportive measures to promote the innovation of the financial sector and increase international competitiveness to better serve the real economy and people's livelihood. It also stressed the need to unswervingly adhere to work both to consolidate and develop the public sector and to en-courage, support and guide development of the non-public sector.