Consumers will benefit from the proposed ban on exclusive e-commerce agreements

Reportedly, some e-commerce giants have compelled their sellers to sign exclusive cooperation agreements with them during the big promotion seasons, such as the Nov 11 and June 18 online shopping festivals, and a financial company of an e-commerce platform group has required its partner banks to ink a special agreement to prevent them providing their competitors with relevant services. People's Daily comments:

According to the agreements, the sellers should inform consumers that their products are sold out on other e-commerce platforms, leaving the consumers no choice but to buy via the e-commerce platform they have the agreement with.

That the companies have no choice but to take sides in their cooperation with e-commerce platform providers results from the e-commerce giants abusing their position in the market. This must be addressed as soon as possible so as to guarantee the e-commerce industry's healthy development in the long run.

An obvious strength of e-commerce is that the consumers can conveniently view many options before deciding what and where to buy. The exclusive cooperation model does not give the sellers any choice, creating de facto new barriers and information asymmetry on purpose with the sole objective of generating profits for the e-commerce platforms, which have divided up the internet.

No wonder 10 ministerial-level departments of the central government have put such unfair competition behavior in the cross hairs of a special campaign this month. Hopefully, the campaign can put an end to the practice.

The draft of the E-Commerce Law that China's legislature is to review for the third time outlaws such exclusive cooperation agreements. And it sets out more rigorous stipulations on the partners' responsibilities and obligations.

It is fair competition, not abusing of their monopoly, that has prompted China's internet giants to establish the world's largest e-commerce market. The e-commerce platforms should strengthen their self-discipline, realizing that a healthy competition and business environment will benefit the whole industry in the long run.