The Epoch Times reporter Xia Song recently reported on a major development in the Chinese financial market. At the end of December 2023, the Central Bank of China announced that it had agreed to change Alipay (China) to have no actual controller. This decision has attracted widespread attention in the market.
The official announcement of the major licensing changes for non-bank payment institutions was made on the official website of the Central Bank of China. The announcement, labeled as Document No. 189 of 2023, confirms that the central bank has approved the change for Alipay (China) Network Technology Co., Ltd. to have no actual controller.
In response to this announcement, both Hang Seng Electronics and Cathay Property & Casualty Insurance issued separate announcements on December 29. They confirmed that, since the change in the voting rights structure of Ant Group’s major shareholders had been completed, Ant Group has changed to have no actual controller. As a result, affiliated companies such as Hang Seng Electronics and Cathay Property & Casualty Insurance have also changed to have no actual controller.
Ant Group stated that the voting rights structure adjustment plan for major shareholders had been announced in January 2023 and the relevant procedures had been completed. This adjustment is not expected to have any impact on the daily operations of the relevant companies.
The absence of an actual controller, as outlined in the “Measures for the Administration of Acquisitions of Listed Companies” of the Communist Party of China, means that the equity structure of listed companies is dispersed, with no controlling shareholder holding more than 50% of the shares. It also means that there is no situation in which a single director, senior management personnel, or a group of individuals can control the major financial and operational decisions of the company.
Alipay, which was established in 2004, currently has 100% of its shares held by Ant Technology Group. In January of this year, Ant Group announced plans to introduce more independent directors, adjust the voting rights structure of major shareholders, and promote greater decentralization of shareholder voting rights.
The change in Alipay’s status to have no actual controller has prompted discussion and speculation in the market. Influential voices on social media have voiced their opinions on the matter, with some suggesting that the equity dispersion may lead to a more democratic process for decision-making within the company.
Overall, the decision by the Central Bank of China to change Alipay to have no actual controller has generated widespread interest and commentary in the financial and tech sectors. It remains to be seen how this shift will impact the operations and governance of one of China’s most prominent financial technology companies.