This undated photo shows an outlet of Vipshop in downtown Beijing. (PHOTO PROVIDED TO CHINA DAILY)
The State Administration for Market Regulation said on Thursday it has started investigations into Vipshop (China) Co Ltd and Guangzhou Vipshop E-Commerce Co Ltd for alleged unfair competition.
Vipshop said it would actively cooperate with the investigation. The move came after the authority fined e-commerce giant JD, Alibaba Group's business-to-customer platform Tmall and Vipshop 500,000 yuan (US$77,200) each for irregular pricing last month.
The action indicated that the market regulator is determined to better regulate online economic activities and the e-commerce industry, said Ma Kainong, a lawyer from Zhejiang Zeda Law Firm, adding that more supervision efforts are likely in the pipeline.
The action indicated that the market regulator is determined to better regulate online economic activities and the e-commerce industry.
Ma Kainong, a lawyer from Zhejiang Zeda Law Firm
Ma said the strengthened supervision will help restrict improper operations of platforms, protect fair competition and innovation in the market, safeguard consumer rights and promote the healthy development of the online economy in the long run.
Experts said that in recent years, with new dynamics and new business models emerging, China's online economy has flourished, but competition has become increasingly fierce in some sectors, and the problem of unfair competition has also emerged.
In December, the authorities launched an investigation into Alibaba for alleged monopolistic conduct, including implementing an "exclusive dealing agreement". The issue largely refers to the company's practice of forcing merchants to sell on Alibaba platforms exclusively and preventing them from selling on rival e-commerce websites.
Wang Xianlin, a professor of economic law at Shanghai Jiao Tong University, said unfair competition not only damages the legitimate interests of businesses and consumers, but also distorts and destroys normal market competition mechanisms, ultimately affecting high-quality economic development.
Steps to check unfair competition are necessary for creating and maintaining a fair business environment, said Wang, adding more law enforcement measures should be used to prevent such deeds.
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