The Chinese government says it is allowing foreign companies to fully own some e-commerce businesses in the country, as it looks to bolster overseas investment and boost market competition.
Effective immediately, the new ruling applied to "online data handling and trade handling services, though, no details were provided on how existing e-commerce operators would be impacted, reported Reuters.
Citing a statement on the website of China's Ministry of Industry and Information Technology, the report added that the government in past years had helped drive the market with low taxes and relaxing cross-border trade restrictions.
"[Permitting full foreign ownership] supports our country's e-commerce development, encourages, and brings in active participation of foreign investment, and further excites market competition," the ministry said.
In January, as part of a pilot program, the Chinese government announced it was opening its e-commerce doors to foreign investors, but only limited to the Shanghai Free Trade Zone. It added that telecommunication authorities would oversee the regulation and supervision of foreign players.
Previously, foreign market players would have to establish a joint venture with a local partner to operate an e-commerce business. The mandatory foreign-local partnership is prevalent in other segments including cloud computing, but the government has been gradually letting in foreign capital to boost the local economy.