Taobao to shut down e-commerce operations in Taiwan over discourse

Taobao Taiwan is winding up operations after the Taiwanese Government ordered the firm to re-register as China-backed or leave the country. This move comes as there is increasing scrutiny over Chinese firms amidst rising tensions between Taipei and Beijing.

UK-registered Claddagh Venture Investment, which runs Taobao Taiwan, said it had to shut down e-commerce operations as there were ‘multiple uncertainties in the market’.

The company will exit fully by the end of 2020 and will help merchants deliver existing orders to buyers.

In August, Taiwan Government fined Claddagh Venture US $ 14,132 for violating the law governing Chinese investments and asked to withdraw Chinese funding or restructure the company within 6 months as they believed Claddagh was controlled by Alibaba Group Holding Ltd.

Claddagh on the other hand claimed that Taobao Taiwan did not come under Alibaba and was a different company from Alibaba’s Taobao China.

However, according to findings of the Investment Commission, Alibaba Group holds 28.8 per cent of Claddagh Venture’s shares through its branch company in Singapore.

Additionally, Taiwan also banned the local sales for Chinese TV streaming services operated by the likes of iQiyi and Tencent Holdings in an effort to crackdown on Chinese investments on the island.