NEW YORK (TheStreet) -- Alibaba (BABA) - Get Report shares are down 2.1% to $82.24 in trading on Tuesday after the Taiwanese government ordered the Chinese online and mobile retailer to withdraw operations from the country after accusing the company of violating investment rules.

The Taiwan Investment Commission fined the company about $4,000 and ordered the company to withdraw its operations from the country within six months after accusing the company of entering the country illegally by hiding the fact that it is a Chinese-owned company, instead using a Singapore-based holding company to enter the market.

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"Alibaba was found to have hidden the fact that it is a Chinese-owned company by entering Taiwan via a Singapore-registered entity," said the commission.

Alibaba registered in the country in 2008 through Singapore, but the company's filings for last year's record setting New York Stock Exchange IPO revealed evidence of Chinese control over its Singapore unit, according to the commission.

"We have asked Alibaba to leave. We just want mainland investors who invest in Taiwan to follow the rules," Emile Chang, acting executive secretary of the economic ministry's Investment Commission, told Bloomberg today.

"We will actively communicate with related parties to clarify the issues and, if necessary, will take proper actions to protect the legitimate interests of Alibaba.com," the company responded via email.

BABA data by YCharts