Taobao Taiwan announced Thursday that it will shut down its service at the end of the year after it identified as a China-owned company.
Taobao, China's most popular mobile commerce platform operated by Alibaba Group Holdings Ltd. (NYSE: BABA; HKEX:09988) launched Taobao Taiwan in August 2018. Even though Taobao Taiwan is registered through its operator, U.K.-registered Claddagh Venture Investment, The island’s Investment Commission in Taiwan stated on August 24 that Taobao Taiwan was determined to be a China-based investment and a fine of NT$410,000 ($13,700) was imposed.
Taobao Taiwan’s App exceeded 2 million download times after the “11.11” shopping event in 2019, and it is growing steadily in the Apple Store and Google Play Store with a monthly growth rate of 15% to 20%.
Alibaba said, "Alibaba Group's business operations in the Taiwan market are smooth. We will continue to serve consumers in the Taiwan market through Taobao and provide high-quality goods."
It has been less than a year since the announcement of the closure to when Alibaba authorized the Claddagh Venture Investment to establish "Taobao Taiwan". The current number of employees in Taobao Taiwan exceeds 100 people.
Shares of Alibaba closed at $299.46, down $1.58 per share in New York today. The stock inched up 53 cents in aftermarket trading.