China’s market regulator, the State Administration for Market Regulation (SAMR), has convened a meeting with major online hotel booking platforms, including Meituan, Douyin, JD.com, Ctrip, Tongcheng, and Fliggy. The aim is to address and mitigate competition risks, particularly concerning practices like “lowest price across the entire network,” also known as “all-network lowest price,” and to foster a healthier, more orderly tourism market.
Regulators Urge Fair Competition in Online Hotel Bookings
The administrative guidance meeting, co-hosted by the Ministry of Culture and Tourism, stressed the importance of platforms strictly adhering to their compliance responsibilities. Officials highlighted that fair competition is the bedrock of a market economy and that compliant operations are vital for business sustainability. While acknowledging the rapid growth of the online hotel booking sector and its positive contributions to convenience and tourism consumption, the meeting also pointed out significant competitive risks that cannot be ignored.
Key players in the online hotel booking industry were reminded of their critical role and urged to uphold legal boundaries, commit to fair competition, and enhance compliance management. The goal is to promote standardized and healthy development within the sector.
Addressing “Lowest Price” and “Exclusivity” Concerns
The assembled platform companies were instructed to meticulously review their practices in light of laws such as the Anti-Monopoly Law, the Law Against Unfair Competition, the E-commerce Law, and the Tourism Law of the People’s Republic of China. The directive specifically calls for self-examination to prevent and resolve issues related to “internal friction” and competition risks, such as:
- Exclusive Cooperation Agreements: Practices that restrict platforms from working with competitors or suppliers.
- “Lowest Price Across the Entire Network”: Policies that mandate offering the absolute lowest prices on a platform compared to all other online channels.
Platforms are expected to enhance their compliance awareness, reinforcing the foundations of compliant operations and secure development. They need to establish robust, long-term compliance mechanisms. The overarching objective is to cultivate a market environment characterized by quality services at fair prices and healthy competition, thereby safeguarding the legitimate rights and interests of consumers and promoting mutually beneficial development among all stakeholders within the platform ecosystem.
Promoting a Balanced Ecosystem
The regulators emphasized that by proactively addressing these competition risks, the online hotel booking industry can move towards a more sustainable and equitable future. This initiative is crucial for maintaining consumer trust and ensuring the long-term vitality of China’s rapidly expanding tourism market. The focus on compliance and fair play is designed to benefit consumers, businesses, and the industry as a whole.
