China warns platforms on monopolistic tactics such as ‘lowest-price’ requirement

China’s market regulator has warned that internet platforms demanding merchants offer the “lowest price across the internet” may face antitrust action, as Beijing steps up efforts to curb malpractice.

The State Administration for Market Regulation (SAMR) explained some details of its draft – Antitrust Compliance Guidelines for Internet Platforms – at a press conference on Wednesday, according to Xinhua.

The “lowest-price” requirement, where platforms bar merchants from selling cheaper elsewhere, is one of eight potential violations identified in the draft, according to Liu Jian, deputy director of antitrust enforcement at the administration.

“How to scientifically set boundaries for their conduct presents considerable complexity,” Liu said, citing the unique business models of the platform economy and pointing out how it often involves “the interests of multiple stakeholders”.

The draft, which the SAMR presented for public feedback last month, also targets opaque algorithms that could harm merchants and consumers. The consultation period ended on November 29. A final version of the guidelines has not yet been unveiled, but SAMR said on Tuesday that it was accelerating efforts to issue the final version of the guidelines, according to Xinhua.

Guidelines will push platforms to develop “benevolent algorithms” and conduct regular audits to prevent algorithmic monopolies, Liu said.