On January 26, 2014, the State Administration for Industry and
Commerce released "Measures for the Administration of Online
Transactions" (hereunder referred to as "the
Measures"), to further strengthen the regulation of online
transactions. The Measures have come into force on March 15 and the
previous "Interim Measures for the Administration of Online
Commodities Trading and the Relevant Services" (hereunder
referred as to the "Interim Measures") are revoked.
The Measures (1) strengthen the protection of consumers interest
and personal information, (2) regulate the competition between
business operators, (3) defines what is a trading platform
(marketplace) and other relevant service operators (storage
service, courier service, etc), and clarify their obligations with
regards to protecting intellectual property rights. Moreover, the
Measures reinforce the AIC's supervision on network
transactions. Unfortunately, they make no change to the
administrative jurisdiction (which was in the Interim Measures)
which will seriously affect the effectiveness of enforcement
against infringements in the online marketplaces.
Strengthening the protection of consumers rights and personal
Upon request of the consumer, the business operator must issue
an invoice. In case of complaint, the consumer may use an
electronic shopping voucher to prove the transaction. Furthermore,
the consumer may return the goods within 7 days without any
The Business operator is prohibited from leaking, selling or
providing customers' personal information to others without the
permission of the customer. In the event such information is leaked
or lost, the business operator must immediately take remedial
actions. Likewise, the business operator may not send commercial
electronic messages to customers.
Regulation of the competition between operators:
The Measures reveal, and prohibit, certain practices: self
promotion of commercial reputation of operators by using virtual
transactions or deleting negative evaluations; damaging the
reputation of their competitors by posting malicious evaluation;
conducting technical attacks on the website or webpage of
Clarification of the obligations of operators providing online
The marketplaces shall bear the following liabilities:
systematically examine the real identity of business operators;
ensure the transparency of management regulations and guarantee
that the users can easily access to these regulations; assist the
AIC in stopping infringement, provide registration information and
transaction records upon the AIC's request; keep the
registration information until at least 2 years after cancellation
of registration; keep the transaction records until at least 2
years after completion of the transaction.
Service operators providing network access, server hosting,
virtual space renting and website and webpage design and building,
shall examine business qualification and personal identity
information, and keep such information until at least 2 years after
the termination or fulfilment of the service contract. Anyone who
promotes products or services via blog or microblog, against a
remuneration, shall disclose the for-profit nature of such
promotion; service providers for network access, payment and
settlement, logistic and express delivery should actively cooperate
with the AIC and provide information concerning infringers, upon
the AIC request.
Reinforcing the supervision of the AIC:
The Measures provide that technical monitoring records can be
used as digital evidence to initiate raid actions or make penalty
However, the main issue concerning jurisdiction remains
unchanged: an infringement occurred in the marketplace shall be
dealt with by the AIC at the place where the marketplace is
located. Taking Taobao.com as an example, all infringements found
must still be dealt with by the Hangzhou AIC, while most of the
infringers are located elsewhere. We will, therefore, still be
facing the situation that the AIC having jurisdiction over the
infringement is incapable of taking any action due to the
geographical distance, because the AIC of the place where the
infringer is located has no jurisdiction.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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