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A Letter to Our Customers and to the Community

Dear Alibaba merchants, consumers, partners and shareholders,

Today Alibaba Group received the Administrative Penalty Decision issued by the State Administration for Market Regulation (SAMR) of the People’s Republic of China. We accept the penalty with sincerity and will ensure our compliance with determination. On this occasion, the entire team at Alibaba would like to express our gratitude to the trust and patience that our merchants, consumers, partners and shareholders have given us. We would like to share our thoughts and plans for the long-term healthy development of our business in the future.

Over the past several months, we fully cooperated with the SAMR investigation and seriously studied the government’s policies and expectations for Internet platform economies. In this connection, we conducted a self-assessment of, and implemented improvements to, our internal systems while ensuring stable operation of our business. The penalty issued today served to alert and catalyze companies like ours. It reflects the regulators’ thoughtful and normative expectations toward our industry’s development. It is an important action to safeguard fair market competition and quality development of Internet platform economies.

Internet platform economies are new economic structures created out of the latest cycle of technological revolution. Because of China’s economic and technology development, as well as regulatory support for innovation, Alibaba has been given the opportunity to explore and create platform business models such as Taobao and Tmall with the help of millions of small- and medium-sized merchants and hundreds of millions of consumers. The platform model lowered the costs of starting and doing business, improved efficiency and enhanced circulation of economic activities. Today, Internet platform economies have entered an entirely new phase. They are an integral part of people’s everyday life and affect all dimensions of the broader economy. It is not lost on us that today’s society has new expectations for platform companies, as we must assume more responsibilities as part of the nation’s economic and social development. At the same time, we are cognizant that the value of platforms comes from helping participants to succeed through integrating and sharing resources, as well as continuously creating value for society.

We are acutely aware that our livelihood depends on keeping up with the times and our nation’s development; continuously listening, understanding and servicing our countless merchants and consumers; and being steadfast in pursuing technological innovation. We will further strengthen our focus on customer value creation and customer experience, as well as continuing to introduce measures to lower entry barriers and business costs of operating on our platforms. We are committed to ensuring an operating environment for our merchants and partners that is more open, more equitable, more efficient and more inclusive in sharing the fruits of growth.

Today is an important day in Alibaba’s journey of growth. It is a new starting point for us, one where we tackle problems head on and commit to innovate. Alibaba would not have achieved our growth without sound government regulation and service, and the critical oversight, tolerance and support from all of our constituencies have been crucial to our development. For this, we are full of gratitude and respect. We started Alibaba because we believe in treating customers first and creating sustainable long-term value for society. These are our reasons for being, to which we are fully committed, and from which we will never waver.

Alibaba Group

2021.4.10­

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