Home / Business and Economy / China Cracks Down on E-Commerce Giants
China Cracks Down on E-Commerce Giants
7 Jan
Summary
- New regulations ban platforms from coercing merchants into promotions.
- Meituan cited 'irrational competition' for its first loss in years.
- Rules effective February, aim to cool intense e-commerce competition.
China has unveiled comprehensive regulations targeting major e-commerce platforms, set to take effect in February. These new rules specifically prohibit companies such as Alibaba, JD.com, and Meituan from compelling online merchants into participating in promotions, a move designed to mitigate escalating competition.
The directives come after repeated warnings from Beijing regarding practices that disrupt market order. In addition to curbing merchant coercion, the regulations also bar online influencers from making false claims and mandate that platforms protect consumer data. Violations may result in warnings and fines.
This regulatory shift underscores Beijing's intensified focus on the retail sector since 2025, particularly concerning practices like aggressive discounting and exclusive arrangements that disadvantage smaller merchants. The intense competition has already impacted company finances, with Meituan blaming "irrational competition" for its recent financial losses.
