China Expands E-commerce Laws to Include Micro Merchants, Promote Fair Competition
The Beijing News, 6/20/18
The standing committee of China's National People's Congress recently issued a draft update to China's e-commerce laws. The regulations clarify that in addition to third-party e-commerce platform operators, operators engaged in e-commerce through third-party platforms, and independent website operators, other e-commerce operators engaged in online sales of products or services are also within the scope of China's national e-commerce laws. This means that micro merchants operating through online platforms such as Tencent's (0700.HK) WeChat mobile messaging app are also subject to regulation under national e-commerce law provisions.
The draft regulations also propose specific language clarifying that additional goods or services may not be "bundled" together with a user's purchase without explicit user consent, and that methods and processes used to refund user security deposits may not set unreasonable conditions for deposit refunds. E-commerce operators may be fined up to RMB 500,000 for violations of these provisions.
In addition, the draft regulations propose adding new provisions to prevent platforms from forcing merchants to choose between platforms, and to allow platform operators to be held joint-and-severally liable in cases of fraudulent product sales.
Editor's Note: For more information on this topic, please see China's E-commerce Law Expected to Launch Next Year, MD 11/28/17 issue.
Keywords: e-commerce Internet law regulation bundling NPC
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