On Tuesday, China’s regulator proposed new changes to a law on unfair competition, created new pathways for fines ranging as high as a 5% share of a firm’s annual revenue to punish such practices by internet companies.
There will be a window for the public to comment until Dec. 22. These new changes are part of a two-year-old crackdown on formerly freewheeling giant internet firms, which China has punished for activities from monopolistic behavior to exploiting consumers.
According to the changes operators must not use data, algorithms, technology or any capital advantages to engage in unfair competition, the State Administration for Market Regulation (SAMR) said.
To protect consumers, operators would be barred from using algorithms to give users “unreasonably different treatment or unreasonable restrictions”, by analyzing user preferences and their trading habits, it added.
Among the new rules, one particularly prevents a business in an advantageous position from forcing a counter-party to sign exclusive agreements. Also, such businesses should not block external links or services from their platforms without a reason, the regulator said.