Overview
- The State Administration for Market Regulation published draft rules on June 17 that would ban long-term, large-scale subsidy campaigns and selling below cost to win market share.
- The draft would bar platforms from forcing merchants to join subsidy programmes or shifting subsidy costs onto merchants and delivery drivers and forbid using traffic allocation to coerce participation.
- Platforms would be required to disclose details of subsidy campaigns before they start and after they end and would face named legal obligations and liabilities under the proposal.
- The draft is open for public comment until July 17 and major delivery firms including Meituan, Alibaba’s Taobao Shangou and JD.com have publicly endorsed the proposals and pledged to cooperate.
- Regulators frame the move as part of a wider effort to curb market-distorting tactics that have hurt merchants, squeezed delivery workers and distorted consumer spending, and the rulemaking could lead to formal enforcement if finalized.