By Ma Yuan & Chen Hongyu, Research Team on “Antitrust and Fair Competition for Internet Platforms”, Enterprise Research Institute, DRC

Research Report, No.201, 2021 (Total 6266) 2021-7-19

Abstract: A batch of Internet platforms have emerged in China’s e-commerce, food and beverage takeaways, taxi-hailing service and other fields. While supporting digital development of businesses, these enterprises charge multiple fees from transaction commissions, delivery service fees, marketing costs to payment service fees. In comparison, China’s E-commerce platforms charge lower transaction commissions than their international counterparts, but the rapid increase in their marketing costs, price raise by regional agents and seductive loaning practice have become major public concerns nowadays. Sample merchants’ data show that the payment for on-line platforms account for over 21% in the revenue of the platforms, and the income increase brought by every yuan of platform fee for the merchants has started to fall. To stem this momentum, it is necessary to build a digital eco-system for mutual benefit and co-existence, with improved charging rules on the part of the platforms, strengthened monitoring for competition, and regulated online marketing order. Tailored measures need to be adopted for different platforms to lower merchants’ overall costs, and references for determining price fairness on the platforms also should be studied and put into place.

Keywords: platforms, merchants, commissions, marketing, overall costs