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Tag: regulator

  • Mysterious $1B Investment in True Telecom Sparks Investigation by Thailands Market Regulator

    Mysterious $1B Investment in True Telecom Sparks Investigation by Thailands Market Regulator

    The Thai market regulator has initiated an investigation after an individual surfaced with an estimated one billion US dollars in shareholdings in telecom titan True Corporation, thereby becoming one of its largest shareholders. The regulatory body intends to gather further details and seek explanations from relevant entities in compliance with the standard procedures, as per a recent announcement.

    Stake Increase and Company Backing

    The individual, identified as Supaporn, disclosed in a regulatory filing last week that she had amplified her stake in True, which is based in Bangkok, from 3.9% by purchasing shares through an international broker. Her investment equates to roughly 32 billion baht ($960 million), calculated based on True’s closing price on Monday.

    True Corporation enjoys the backing of Charoen Pokphand Group (CP Group), one of the largest conglomerates in Thailand, and holds the position of the country’s second-largest mobile phone service provider. Earlier this year, Arise Digital Technology, under the control of True’s chairman Suphachai Chearavanont, bought approximately a 25% stake in True from Norway’s Telenor for 39 billion kroner (US$3.9 billion). Both CP Group and Telenor had studied the possibility of merging their telecom units in 2021.

    This deal also included an opportunity to buy an extra 5.4% stake within a two-year timeframe.

    Discrepancies and Legal Implications

    However, there seem to be some inconsistencies in the details provided by Supaporn in her regulatory filing, according to a statement issued by True. The firm stated that it has never offered preference shares to the public and currently does not have any outstanding preference shares. The company has reportedly informed the SEC about the inconsistency.

    The Thai regulator has issued a warning that stern legal measures would be enforced if the ongoing probe uncovers any breaches of the prevailing regulations.

    True also mentioned that the disclosure made by Supaporn about her augmented stake was labeled as preliminary, indicating that the details are incomplete and remain under scrutiny.

    On a different note, this Monday marked the completion of the sale of a 10% stake in True by the CP Group, achieved via a series of transactions as per an official statement.

    Questions & Answers

    What initiated the review by the Thai market regulator?
    The review was initiated after an individual emerged owning nearly one billion US dollars in shareholdings in True Corporation, making her one of its largest shareholders.

    Who is backing True Corporation?
    True Corporation is backed by Charoen Pokphand Group, one of Thailand’s largest conglomerates.

    How did True Corporation react to Supaporn’s regulatory filing?
    True Corporation pointed out some inconsistencies in Supaporn’s filing, stating that the company has never offered preference shares to the public and currently does not have any outstanding preference shares. The firm has notified the SEC about the discrepancy.

  • Chinese Regulator Slaps Billion-Dollar Fines on Food Delivery Giants over Safety Violations

    Chinese Regulator Slaps Billion-Dollar Fines on Food Delivery Giants over Safety Violations

    China’s market regulator recently imposed fines and seizures on seven e-commerce platforms, totaling 3.6 billion yuan (US$527.32 million), for failing to adhere to food delivery safety guidelines. The offenders include prominent companies such as Pinduoduo, Meituan, JD, ByteDance’s Douyin, and Alibaba’s Taobao Shangou.

    Violation of Safety Protocols

    Investigations revealed that these companies did not implement necessary measures to protect consumers. They were also found to be negligent in verifying the licenses and qualifications of online food vendors. The regulator has expressed concern over this lax approach towards consumer safety and vendor credibility.

    Pinduoduo responded to the penalties by stating that the company “sincerely accepts and will resolutely comply” with the regulator’s decision. It also pledged to learn from this episode, standardize its business procedures, and make necessary improvements. However, Meituan, ByteDance, and Alibaba did not respond immediately to requests for comments.

    Intense Competition in China’s Food Delivery Market

    In the past year, food delivery in China has witnessed escalating competition, with e-commerce giants like Alibaba and JD actively trying to gain market share. These companies have been offering attractive discounts and coupons on a wide range of products, including ice cream and takeaway coffees.

    This battle to establish dominance in the ‘instant retail’ domain, where goods are delivered within an hour, has affected profits and attracted regulatory attention. Chinese regulators have repeatedly cautioned against the unhealthy “race-to-the-bottom competition” prevalent among food delivery firms.

    Questions & Answers

    What prompted the fines on the e-commerce platforms?
    The companies violated food delivery safety protocols and failed to verify the qualifications and licenses of online food vendors.

    How have the companies reacted to the fines?
    While Pinduoduo has openly accepted and pledged to comply with the regulator’s decision, Meituan, ByteDance, and Alibaba have not responded immediately to the penalties.

    Has the increased competition in food delivery affected the companies?
    Yes, the escalated competition, epitomized by discounts and coupons, has not only squeezed profits but also attracted regulatory scrutiny due to a “race-to-the-bottom competition” mentality.

  • Australian Regulator Warns of Lacking Crypto Protection

    Australian Regulator Warns of Lacking Crypto Protection

    The Australian Securities and Investments Commission cautioned investors about cryptocurrency risks, noting that they are «on their own» for the time being as efforts are underway to develop regulations.

    Consumers should approach investing in crypto with great caution, said ASIC chair Joe Longo at the recent Australian Financial Review Conference.

    At present many crypto-assets are probably not ‘financial products for the most part, for now at least, investors are on their own.

    Not unlike markets elsewhere, demand for crypto-assets and related services is on the rise in the country with big four lender Commonwealth Bank of Australia recently becoming the first in the sector to roll out a retail offering that will cover 10 cryptocurrencies by 2022.

    Crypto is on our doorstep, here and now, and being driven by extraordinary consumer and investor demand. The implications for consumers are potentially huge, Longo added.

    ASIC does not strive to eliminate risk. But, nor should we ignore it.

    Lees ook:

  • Alibaba beats revenue forecast as Chinese regulators hover

    Alibaba beats revenue forecast as Chinese regulators hover

    China’s Alibaba Group Holding Ltd beat estimates for third-quarter revenue on a pandemic-driven jump in e-commerce, but its shares dropped amid regulatory heat for founder Jack Ma’s business empire.

    It also announced a bond sale worth as much as $5 billion through sources have said plans for the fundraising were in the works before the regulatory clampdown.

    Ma’s current woes stem from an Oct. 24 speech in which he blasted China’s regulatory system, leading to the suspension of his Ant Group’s $37 billion IPO just days before the fintech giant’s listing.

    Regulators have since launched an anti-trust probe into the tech sector, while tighter regulations for Ant are also being considered.

    Ma, who has been keeping an uncharacteristically low profile these past three months, was also conspicuously snubbed this week by his omission in a state media list of entrepreneurial leaders.

    Alibaba CEO Daniel Zhang said changing regulations for internet and fintech firms in China presented a near-term challenge.

    “We regard this as important opportunities for re-assessing and improving business practices,” he told an earnings call.

    Alibaba also said it was “unable to complete a fair assessment” of the impact that Ant’s stalled IPO will have on the company. Zhang said, however, that any potential reduction in consumer credit offerings from Ant would not have an impact on Alibaba’s e-commerce business.

    Shares in Alibaba dropped 4% in Hong Kong on Wednesday, having closed down nearly as much on the New York Stock Exchange.

    Alibaba’s total revenue rose 37% to 221.1 billion yuan ($34.2 billion) in the three months ended Dec. 31, above analysts’ estimates of 214.4 billion yuan, according IBES data from Refinitiv.

  • China Regulator Issues Record-High Penalty

    China Regulator Issues Record-High Penalty

    China’s securities watchdog issued 3.6 billion yuan of penalties over a case of insider trading by a Shanghainese entrepreneur and his daughter – an all-time record-high regulatory fine.

    Wang Yaoyuan and his daughter Wang Chengcheng were fined 2.72 billion yuan ($380 million) for using inside information to build long positions on the shares of listed healthcare company Joincare Pharmaceutical Group. The two made a net gain of 906.4 million yuan ($128 million) which was also confiscated by the China Securities Regulatory Commission (CSRC).

    According to the CSRC, the two had obtained insider information that Joincare’s second-largest shareholder Hongxinhang would transfer a 4.8 percent stake to units controlled by two major investors: Tencent founder Ma Huateng and ZhongAn chief executive Ou Yaping. The elder Wang obtained insider information in 2015 through Ou and the controller of Hongxinhang via phone calls and physical meetings.

    Neither Tencent’s Ma nor ZhongAn’s Ou was fined or reprimanded by the regulator.

    China’s regulator has been increasingly active with issuing fines in a move viewed by onlookers as the end to the practice of immaterial penalties to further discourage unhealthy practices. Earlier this year, the People’s Bank of China imposed the first-ever fines of above 10 million yuan ($1.4 million) to China Minsheng Banking Corporation, China Everbright, and Huatai Securities.

    In the first quarter of 2020, the CSRC issued a total of 19 penalties accounting for a 35 percent year-on-year increase, involving mostly cases of insider trading, market manipulation and violation of disclosure rules.

    The 3.6 billion yuan fine on the Wangs reportedly surpassed the former leading fine of 3.47 billion yuan issued against the ex-controller of Shanghai Duolun Industry over price manipulation and disclosure breaches.