Alibaba Suspends Online Lottery Sales In Yet Another Tiff With Government Regulators
Vittorio Hernandez | | Mar 01, 2015 07:10 AM EST |
(Photo : Reuters) Chinese ecommerce giant Alibaba Group is currently testing a mobile messaging application called DingTalk that combines social networking with business.
Pressure from the Ministry of Civil Affairs and the General Administration of Sport ordered Chinese e-commerce giant Alibaba Group Holding to suspend its online lottery sales.
Alibaba immediately followed the order and cancelled sales on tabao.com and Alipay, its mobile payment app. But Alibaba assured winners that it would pay the winning tickets that were sold, while those who bought pre-paid later rounds will be refunded at the latest within five days, reports Chinadaily.com.
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The General Administration of Sport said on Wednesday that the order was part of its crackdown on illegal online sport lottery sales. On Friday, the agency and the Ministry of Finance and Ministry of Civil Affairs challenged Chinese lottery operators to go through a self-examination and self-correction when selling online.
In 2014, sales of sport lotteries reached $28.38 billion or 176.41 billion yuan due to the availability of payment services via smartphones. The growth rate was 32.8 percent year-on-year, almost double the industry expectation of 100 billion yuan. It is almost half of the total lottery sales in China which increased 23.6 percent compared to 12 months ago of 382.38 billion yuan.
A few weeks ago, Alibaba had problems with government regulators over charges that it was not doing much to stop the advertising of fake goods on Alibaba websites.
On news of the order from government regulators, shareprices of 500.com Ltd., the biggest online sport lottery purchasing platform, dropped to its lowest in over 12 months.
Xie Liang, a sports commentator, attributed the big jump in online lottery sales to major international sport events, including the World Cup in Brazil. Since June, Chinese consumers who previously did not buy sports lottery tickets became regular buyers, according to Wang Huqing, owner of lottery store in Guangzhou City, capital of Guangdong Province.
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