After weeks of debates in the society about internet giants entering community groupbuy (which we took part as well), the regulators finally stepped in.
On 22 Dec, State Administration for Market Regulation (SAMR) has co-organised a meeting with Ministry of Commerce. Representatives of Didi, Alibaba, Pinduoduo, JD.com, Meituan and Tencent were present.
The authorities have issued 9 “NOs” to the participating companies:
- No dumping, price fixing, price hike, or any other activities to abuse their pricing power;
- No monopolistic agreements among players to fix the price, limit production/sales, or divide market;
- No predatory pricing, refusal of transactions, forced bundling of goods or other activities that abuse the market power;
- No concentration of players or limiting competition;
- No misleading publicity, fake information, defamation or any other unethical competitive activities;
- No abuse of loyal customers using big data;
- No use of technology to harm competitive order, or disrupt other players’ normal business operations;
- No illegal collection and use of consumers’ personal data that might harm the consumers;
- No sale of fake and bad quality produce, which harms trust in the consumption environment.
While the lis might look long, the message seems to be clear. While many in the market believe that this will curb the players, we actually think most of the players are actually feeling relief after the meeting.
The reason is simple, when all your competitors are entering a field that is not regulated, and using wild tactics to grow – can you afford not to do it?
When the regulator stepped in, rules are established. As long as they are enforced, you do not have to worry about competitors doing things you are not allowed to do.
Isn’t that the exact reason why regulations are needed to maintain the order?
Thanks for reading The Low Down (TLD), the blog by the team at Momentum Works. Got a different perspective or have a burning opinion to share? Let us know at [email protected]