The Chinese government has fined Alibaba AU$3.7 billion for anti-competitive tactics.

The State Administration for Market Regulation has announced online retail giant Alibaba has been fined for “abusing its dominant position” to limit competition and hinder the “free circulation” of goods.

The fine of 18.3 billion yuan (AU$3.7 billion) is equal to 4 per cent of Alibaba's total 2019 revenue.

“Alibaba accepts the penalty with sincerity and will ensure its compliance with determination,” the company said in a statement, promising to “operate in accordance with the law with utmost diligence”.

China's ruling Communist Party says anti-monopoly enforcement is a priority this year.

Twelve companies including Tencent Holdings, which operates games and the popular WeChat messaging service, have already been fined the equivalent of AU$100,000 each for failing to disclose previous acquisitions and other deals.

The government is imposing a policy dubbed “choose one of two” which requires businesses select a single platform or supplier, rather than being able to work with both.