China allows foreign marketplaces

China allows foreign marketplaces

The Chinese government has lifted the ban on foreign online marketplaces. Up until now, foreign companies which owned an online marketplace were not allowed to enter the Chinese market using their own web shops.

Law circumvented

The actual law stated that a Chinese company had to control more than 50 % of the shares of a web shop or online marketplace and foreign parties often used that particular rule to circumvent the law. Many major companies used Chinese companies, which they controlled, to set up these online marketplaces anyway.

 

Those companies will no longer have to use these tactics to be active in the Chinese market, as the ban has been lifted. Alibaba, which controls 80 % of the Chinese online market, will now probably face bigger competition than it had done up until now, as companies like eBay and Amazon will now be able to square off in the Chinese market.

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