On Tuesday, Chinese social networking Weibo shares (listed in Hong Kong) fell more than 9%. This happened as regulators fined its operator three million yuan, equal to $471,152.
China’s Cyberspace Administration declared on its official WeChat account that they fined the operator BJ Weimeng Innovation and Technology Company because they found some content violated regulations.
According to the regulator, Weibo faced 45 fines total of 14.4 million yuan, equal to $2.25 million, from January to November 2021.
Since Weibo’s listing in Hong Kong, the stock has lost more than 11%. Its Nasdaq-listed shares fell 7% on Wall Street and dropped more than 27% year-to-date.
According to a CNBC translation, Weibo reacted to the fine, saying it will take care of the necessary rectification while improving its governance.
Beijing attempted to engage in a constant regulatory crackdown on its tech companies, which dominated its internet space.
By the end of the last year, Ant Group’s high-profile IPO experienced suspension while regulators demanded the company’s executives. Since then, regulators have introduced several new rules in various areas, including antitrust for internet platforms. It also maintained data protection law. Both e-commerce giant companies such as Alibaba and food delivery company Meituan have also received fines for apparent antitrust behavior.
Chinese companies face political pressure to list nearer to home instead of being listed in the U.S. It happens as China fears that some of these companies might have to delist from the U.S.
Earlier this month, Chinese company Didi said that it plans to list in Hong Kong exchange while delisting from the New York Stock Exchange. Regulators want Didi to delist from the New York Stock Exchange concerning the leakage of sensitive data.
As tensions between China and the U.S. increased, former U.S. President Donald Trump decided to remove investments in Chinese companies, especially those companies connected to the Chinese military.
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