China fines 7 e-commerce platforms 3.597 bln yuan for violations involving food delivery

BEIJING, April 17 (Xinhua) -- China's top market regulator said on Friday that it has imposed a total fine of 3.597 billion yuan (about 524 million U.S. dollars) on seven major e-commerce platforms for their involvement in a string of food delivery "ghost shop" cases and food safety violations.

The State Administration for Market Regulation (SAMR) said in a statement that the administrative penalty decisions were handed down to Pinduoduo, Meituan, JD.com, Ele.me (now rebranded as Taobao Flash Sale), Douyin, Taobao, and Tmall in accordance with China's food safety and e-commerce laws.

These platforms have been ordered to rectify their actions and suspend the addition of new cake shops for periods ranging from three to nine months, according to the SAMR.

Additionally, the legal representatives and food safety officials of the seven companies were collectively fined 19.6874 million yuan for failing to fully perform their duties on food safety management.

Investigations have found that these companies failed to strictly review the licenses of food vendors operating on their platforms, thereby violating their statutory duty to verify vendor qualifications, the SAMR said.

These platforms also entered into cooperation agreements with order-transfer platforms, despite knowing or being expected to know that such actions would harm consumers' legitimate rights and interests, it added.

The SAMR noted that as early as the investigations were launched, it had immediately instructed these platforms to make prompt rectifications, and all of them have since removed unapproved "ghost shops" and ceased cooperation with related order-transfer platforms. ■