China Fines JD, Tmall and VipShop for Shady Double-11 Shopping Event Promos(Yicai Global) Dec. 31 -- China’s market regulator has fined JD.Com, VipShop and Alibaba’s Tmall for pricing irregularities during this year’s Double-11 shopping gala.
The first Double-11, the world’s biggest annual retail extravaganza, was in 2009. It used to be held only on Nov. 11, hence its name, but this year’s event spanned a month. The subsidies, vouchers and price-break coupons that vendors dangled during this year’s multi-billion-dollar event demanded reams of calculations and the merging of multiple orders, causing consternation among consumers.
The SAMR penalized Beijing Jingdong Century Information Technology, which is a wholly owned unit of Beijing Jingdong Century Trade, Tmall’s operating entity Hangzhou Haochao E-Commerce and Guangzhou Vipshop E-Commerce on Dec. 24.
VipShop said it will respect and strictly comply with the penalty, adding that the platform will also make thorough rectification of these issues as per the requirements and laws and regulations to further standardize its operations and guarantee its customers’ rights and interests.
JD.Com and Tmall have yet to respond.
Earlier this month Yicai Global also reported that the regulator had fined Alibaba Group Holding as well as China Literature and Shenzhen Hive Box Technology, two other internet companies, for failing to fully declare past acquisitions in a further sign of government efforts to crack down on monopolistic practices in the sector. The SAMR also fined them CNY500,000 each.
The unfair pricing happened with seven items VipShop sold during the Double-11 event. An Apple laptop was tagged as having ‘the lowest sale price of CNY7,999 (USD1,220) among all online retailers,’ but VipShop was unable to offer any materials to support the claim.
JD.Com was implicated in unfair pricing of nine goods. The cost of a Hisense-branded cell phone was allegedly cut by CNY300 (USD46), but the actual discount was a mere CNY91 (USD14).
Ten products sold on Tmall were unfairly priced. One type of rice the target of a 50 percent-discount promotion was marked at CNY88.8. So its ‘discounted’ price was CNY44.4, but that had been its original price before the promotion.
Editor: Ben Armour
