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China Insights

SwedCham China Insights for the week of August 30 – September 3, 2021

Top news of the week:

  • State Council eyes improving employment during FYP period
    August 30, 2021

    On 27 August, the State Council published a plan for promoting employment during the 14th Five-Year period, stating the urgency of stable employment for economic development. For the first time, the plan included the proportion of labour renumeration in GDP into the KPI of government agencies. The plan also specifically requires improvement of frontline workers’ wages and calls for increasing the ratio of labour wages in the “primary distribution of income.”

  • Party strengthens arsenal against anti-trust and unfair competition
    August 31, 2021

    The Party’s top organ leading reform held its 21st meeting on 30 August. Chaired by General Secretary Xi Jinping, the meeting reviewed and passed four key guiding opinions, respectively for 1) strengthening regulatory and monitoring effort for anti-trust and unfair competition, 2) reforming and optimising mechanism for strengthening management for strategic and emergency materials, 3) ensuring the winning of the battle for pollution prevention and governance, and 4) better utilisation of the regulatory and monitoring function of statistics.

  • E-commerce law amendments highlight IPR issues
    September 1, 2021

    On 31 August, China’s State Administration for Market Regulation issued a draft for public opinions of the “Decision on Amending the E-commerce Law of the People’s Republic of China.” With the proposed amendment to the E-commerce Law, platform operators can be held responsible for failing to take necessary measures against infringement of intellectual property rights (IPRs).

     

  • Government summons ride-hailing platforms over unfair pricing and driver treatment
    September 2, 2021

    China’s Ministry of Transport, together with other four departments, announced that it summoned 11 online ride-hailing platform companies on 1 September for a regulatory meeting. Meituan and Didi were among the companies summoned. Problems mentioned during the meeting include false marketing, unfair competition, recruiting unlicensed drivers/vehicles, and disturbing market order. Other focuses of the meeting related to driver pay issues and working conditions. In response, JD.com and Didi have set up company organized labor unions for their drivers.

     

  • Xi promises further opening up and SME support
    September 3, 2021

    On 2 September, President Xi spoke via video at the Global Trade in Services Summit of the 2021 China International Fair for Trade in Services in Beijing. Xi told the participants that China will open up at a higher level by implementing nationwide a negative list for cross-border services trade and by exploring the development of national demonstration zones for the innovative development of trade in services. Xi also committed to further improving rules for the services sector and supporting the innovation-driven development of small and medium-sized enterprises through concrete measures.

     

Insight of the week:

On September 2, China’s Ministry of Transport, together with other four departments (i.e. Office of the Central Cyberspace Affairs Commission, Ministry of Industry and Information Technology, Ministry of Public Security, State Administration for Market Supervision), announced that it summoned 11 online ride-hailing platform companies on 1 September for a regulatory meeting. Didi and Meituan were among the companies summoned. Problems mentioned during the meeting include false marketing, unfair competition, recruiting unlicensed drivers/vehicles, and disturbing market order. The meeting specifically required relevant companies to avoid utilizing capital for vicious competition and disorderly expansion, while ensuring information and data security. These companies are required to complete rectification by the end of the year. This is the latest regulatory move on the ride-hailing industry, following when the authority announced that it will impose a cap on the percentage that ride-hailing platforms can take from drivers’ fees and will improve working conditions for drivers in mid-August. In May, jointly with seven other departments, Ministry of Transport summoned ten online transport platforms including Didi, Meituan, Gaode, Lalamove, etc., focusing on the pricing/billing and drivers’ pay issues in transportation and logistics. In response to growing criticisms, JD.com and Didi have set up company organized labour unions for their drivers.

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