Compensation

Double indemnity and punitive damages

Merchants who provide commodities and services through malicious collusion shall, in accordance with consumers’ requirements, compensate more than consumers’ losses, and the penalty shall be 3 times of the paid amount of the commodity or the service; in case the calculated penalty is less than 500 RMB, the ultimate penalty shall be 500 RMB. In case laws provide otherwise with respect to it, the provisions of such laws shall apply. For example, as far as food consumption is concerned, in accordance with relevant regulations of Article 96 in Food Safety Law, when any food manufacturer produces any food not conforming to the food safety standards or any merchant sells any food knowing its nonconformity with the food safety standards, customers can demand the manufacturers or the sellers to pay penalties 10 times of the paid amount, in addition to the compensation for the loss thereof.

In case merchants are fully aware of the defected commodities or services and still provide them to customers, and such defects cause death or severe heath damage to the infringed customers, the infringed not only have the right to demand compensations from the merchants in accordance with Law of People's Republic of China Consumer Rights and Interests Protection, but also have the right to demand punitive damages less than 2 times of their losses from the merchants.