China's National Development and Reform Commission (NDRC), in collaboration with other ministries, has proposed new internet pricing regulations aimed at ensuring a fair competitive environment.
Objectives of the New Pricing Regulations
The new rules proposed by the NDRC and other ministries aim to close regulatory gaps in internet pricing, especially in areas such as price presentation, algorithm-driven adjustments, and dynamic promotions. Regulators have expressed their intention to ensure more equitable competition and promote openness in the digital economy.
Identified Market Issues
There have long been complaints from vendors about leading platforms distorting prices to encourage sales. Notably, Alibaba was fined a record $2.75 billion for antitrust violations. Despite this, major e-commerce companies continue to dismiss regulatory threats while intensifying competition in 'instant retail'.
Approaches to Improving Transparency
The draft regulations require platforms to clearly disclose their fee charges, promotions, and subsidies. Platforms will not be allowed to alter prices or fees for the same products under identical conditions without consumer knowledge, promoting fair pricing and transparency in platform actions and revenues.
The introduction of new internet pricing regulations in China could significantly change the current market dynamics, fostering fair pricing and protecting the rights of consumers and businesses.
