China’s technology giants provide services that have become indispensable to the daily lives of the populace, but their overreaching influence may have prompted authorities to launch the latest antitrust probe into Alibaba Group, marking the start of a wider clampdown on tech innovation in the new year.

The State Administration for Market Regulation said on Thursday that it was investigating the monopolistic practices of Alibaba, namely the “choosing one from two” practice that prohibits merchants from supplying products to rival platforms.

Following the announcement, shares of Alibaba traded in Hong Kong plunged 8.13% to HK$228.2 (US$29.4) as the stock market closed on Christmas Eve.

China’s technology firms, however, may face even more regulatory hurdles in the new year. At the Central Economic Work Conference that concluded last week, top policymakers indicated that next year’s priority might involve intensifying antitrust supervision and preventing “disorderly capital expansion,” a phenomenon closely associated with investments in the technology sector.

According to the Statistical Report on Internet Development in China released by the China Internet Network Information Center, the country’s internet penetration rate reached 67% with 940 million internet users. Close to two-fifths of these users go online for services such as food deliveries, education and ride-hailing.

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