Vipshop fined for violating antitrust law

China's top market regulator has fined Vipshop 3 million yuan (US$441,176) for violating an antitrust law, the latest crackdown on the Internet platform’s market operation irregularities in a campaign to step up regulations of the country’s digital business.  

The State Administration for Market Regulation began investigating last month and found the company had used its own software and data acquisition system to find information about businesses that sell products on Vipshop and other online sites simultaneously.

Between August and December 2020, Vipshop used its supply chain system, middleware and other smart algorithms to prevent shoppers from buying certain types of products. 

“Vipshop has obstructed certain vendors’ sales channels by preventing them from offering products and services through other online retailers," an official from the administration said. "It has failed to stick to the market principle of voluntary fair trade and good faith, which violates the Law Against Unfair Competition." 

The announcement came just a day after the release of antitrust guidelines by the State Council, a formalization of an earlier antitrust draft law that targets Internet platforms to ensure fair market competition.

The council pledged to stop companies from price fixing, restricting technologies and using data and algorithms to manipulate the market or force merchants to choose among the country’s top Internet companies.

Last December, it levied penalties against affiliates of Tencent and Alibaba for failing to seek proper approval to carry out acquisitions.