(Bloomberg) -- Alibaba Group Holding Ltd. has secured the endorsement of China’s antitrust watchdog more than three years after a landmark probe into its online behavior, suggesting Beijing is keen to signal its support for the country’s giant internet sector.

Most Read from Bloomberg

• Dense Cities With Low Emissions Suffer Most From Air Pollution, Study Finds

• A Guide to Urban Swimming in Europe, Beyond the Seine

• Intergenerational Housing Could Help Older Adults Combat Loneliness

• Turkey Plans Istanbul Taxi Surge to Tackle Complaints

• As Rural Hospitals Shutter Maternity Wards, Urban Ones Follow

China’s e-commerce leader has ceased the monopolistic practices that prompted an investigation more than three years ago, the State Administration for Market Regulation said in a statement. It stopped forcing exclusive arrangements on merchants, improved services for shoppers and fostered competition among online platforms, the agency said. Alibaba’s US-traded shares rose 4.2% Friday morning in New York.

The official endorsement coincides with growing calls of support from Beijing for private firms and the technology industry, a chorus that’s grown louder as the country struggles to escape a post-Covid economic funk. Government officials have since 2023 signaled a softening in stance toward the private sector compared with 2020 and 2021, when a plethora of agencies launched regulatory crackdowns to curb the power of China’s internet leaders and their billionaire founders.

The antitrust regulator launched its probe into Alibaba in 2020 as one of the opening salvos in that broader campaign, which eventually encompassed sectors from ride-hailing to online education and commerce. Less than a year later, authorities slapped a record $2.8 billion fine on Alibaba after ruling it abused its market dominance.

On Friday, the antitrust agency lauded “effective results” in Alibaba’s three-year rectification work, which it demanded when levying the fine. The regulator added it will guide Alibaba, continue to regulate its operations and help improve compliance.

“This is a new beginning for Alibaba,” the company said in a statement. “In the future, we will continue to focus on innovation, adhere to compliance, increase investment in technology, promote the healthy development of the platform economy, and create more value for society.”

The chilling effect of the crackdown years persists. Funding for new startups has slowed as entrepreneurs and investors, spooked by the intensity of that regulatory campaign, turn toward sectors such as chipmaking and AI that align with Beijing’s priorities. The once-free-wheeling industry has become more cautious about exploring growth initiatives, for fear of provoking fresh scrutiny.

More immediately, the industry is grappling with flagging consumer spending.

In the latest warning to global markets on the health of the Chinese economy, Temu-owner PDD Holdings Inc. on Monday surprised investors with an unusually gloomy outlook. Both PDD — which became a market darling with low-priced goods that helped propel business during China’s downturn — and Alibaba reported revenue that missed estimates.

--With assistance from Jessica Sui and Ville Heiskanen.

(Updates with US share trading in second paragraph.)

Most Read from Bloomberg Businessweek

• Private Equity Is Coming for Youth Sports

• Need 100,000 Balloons for a Convention? Here’s the Guy to Call

• How Rent Controls Are Deepening the Dutch Housing Crisis

• Hong Kong’s Old Airport Becomes Symbol of City’s Property Pain

• Far-Right ‘Terrorgram’ Chatrooms Are Fueling a Wave of Power Grid Attacks

©2024 Bloomberg L.P.