Chinese tech giant Tencent Holdings has ended all exclusive music copyright agreements after China's market watchdog directed it to dissolve its domination in the area, the company said on Tuesday. 

Tencent said it had notified all parties concerned of the move as of August 23, and most of the exclusive agreements had been exited on time, according to a statement published on its official WeChat account.

The company said it would continue to cooperate and engage with the parties in a non-exclusive way. 

China's regulators have escalated scrutiny targeting Tencent and other tech giants, focusing on issues such as monopolistic behavior, unfair competition and consumer rights.

In 2016, Tencent acquired a controlling stake in China Music Corporation in 2016. In terms of exclusive streaming rights, the duo took up over 80 percent of market share.

In July, China's State Administration of Market Regulation (SAMR) said in a ruling that the deal may increase its leverage over upstream copyright parties regarding exclusive copyright agreements and allow the company to restrict new entrants and eliminate or restrict competition in the relevant domain. 

The SAMR ruled that Tencent and its affiliated companies should not engage in exclusive copyright agreements with upstream owners of such rights and terminate existing agreements within 30 days of the regulatory notice.

Although these regulations have a certain impact on the operations of the company, they have little impact on subscriptions, Tencent Music Executive Chairman Peng Jiaxin said during the earnings call in mid-August.

Despite occupying a large amount of exclusive music streaming rights, Tencent Music's monthly active users shrank 4.3 percent year on year to 623 million in the second quarter of the year, said Ye Zhuodong, chief strategic officer, attributing the drop to increased competition from other pan-entertainment platforms.