China Solicits Comments on the New Administrative Measures for Online Commodity Trading

September 20, 2013 Posted by China Briefing Reading Time: 3 minutes

Sept. 20 – China’s State Administration of Industry and Commerce (SAIC) released their draft of the new “Administrative Measures for Online Commodity Trading and Relevant Services (hereinafter referred to as ‘Measures’)” on September 11 to solicit comments from the public.

In 2010, the SAIC enacted the “Interim Measures for the Administration of Online Commodity Trading and Relevant Services (SAIC Order 49, hereinafter referred to as the ‘Interim Measures’)” to regulate online commodity transactions and relevant services provided by online commodity vendors and online service providers in China. The new Measures revise and improve the content of the Interim Measures to further regulate the online market and protect the lawful rights of consumers and proprietors involved in online trading.

To better define the scope of the regulation, the Measures specify that the concept of “online trading” only refers to transactions involving commodities and services conducted through the Internet. Television sales and phone sales are not included.

Considering the current condition of the online market, in order to boost the employment market, the Measures specifically stipulate that individual vendors engaged in online business are allowed to sell commodities and services through the Internet without business registration at the SAIC. However, they are only allowed to conduct such business through a third-party transaction platform, and they must fulfill the registration of the platform on a real-name basis for the purpose of protecting online transaction safety and the lawful rights of customers. Otherwise, they are forbidden from doing business online.

The third-party transaction platform provider should review the business registration and identification of all vendors registered at the platform, and the business license or individual identification information should be prominently displayed on the main webpage of the vendors.

Because third-party transaction platform providers have to take on the responsibility of administrating huge amounts of data for online vendors, consumers, and other commercial matters, the Measures require that a third-party transaction platform provider should be an enterprise legal person registered at the SAIC with the capability to ensure the safety of the platform’s operation.

In addition, the Measures further improve the provisions to provide better protection to consumers compared to the Interim Measures. It encourages third-party transaction platform providers to establish a special fund for the benefit of consumers when their legal rights are infringed, and increases the fines for illegally leaking consumers’ personal information.

The original copy of the Measures can be found here. (attached in the email)

The Measures are currently seeking public opinions and comments, and such feedback can be submitted via the methods below through October 11, 2013.

Website: To give advice or make comments on the Measures, please log on to the website of the Legislative Affairs Office of China’s State Council at http://www.chinalaw.gov.cn/article/cayjzjxt/index.html.
E-mail: Send comments to scs602@saic.gov.cn
Address: Comments can also be mailed to the Department of Market Regulation of the SAIC at 8 East San Li He Road, Xicheng District, Beijing, 100820.

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