Market supervisors in the southern Chinese city of Shenzhen held a closed-door hearing QVOD's alleged copyright infringement on Tuesday, June 17, 2014 [Photo: Xinhua]

Shenzhen-based QVOD Technology is one of China's most popular video sites. [Photo: Xinhua]

Market supervisors in the southern Chinese city of Shenzhen held a closed-door hearing QVOD's alleged copyright infringement on Tuesday, Xinhua News Agency reports.

Shenzhen-based QVOD Technology is one of China's most popular video sites.

Zeng Yaodong, an official from Shenzhen market supervision administration said the 260-million-yuan (42 million US dollars) penalty that are expected to slap on QVOD is based on the company's illegal business profit and its reluctance to reflect upon its wrongdoings.

Zeng explained that the penalty is three times the business turnover of QVOD, which is 86.7 million yuan (13.8 million US dollars). The punishment came as the company continued to deliberately infringe upon other's online information dissemination right despite authorities' previous penalty.

The National Copyright Administration had previously fined QVOD 250,000 yuan (41,225 US dollars) for its malpractice.

The Shenzhen authorities will make the final decision over the penalty, based on feedback from the hearing.