China slaps $129,000 fine on Alibaba

China has fined 80,000 yuan, ($129,000) on eCommerce giant Alibaba for price violations by third-party sellers on its platform.
China slaps $129,000 fine on Alibaba

China’s price bureau in eastern Zhejiang province has fined 80,000 yuan, ($129,000) on eCommerce giant Alibaba for violations by third-party sellers during promotions on its eCommerce platforms.

"The company has been fined 500,000 yuan ($81,000) for matters related to Singles' Day pricing by third-party sellers on our Tmall marketplace in 2013 and 2014 and 300,000 yuan($48,000) for pricing in other promotions in 2013 and 2015," said Alibaba Group in a statement.

In 2009, Alibaba started ‘Singles’ Day’, a November 11Chinese response to Valentine's Day into an online shopping festival. The event picked up sales of more than than $9 billion at last year’s event. The company has since copyrighted the phrase "Double 11", referring to the date (11/11), which in turn, refers to the status of single people. The event has grown to proportions like the Cyber Monday and Black Friday in the United States.

The group further added that it would nevertheless reinforce pricing rules and regulations with sellers to protect consumers. Alibaba’s pricing is handled by third parties.

The 27,000 vendors featured on Alibaba's Singles' Day shopping sites hope to boost sales and gain customers, but some have complained that discounts and cut-throat corporate rivalry undercut the benefits.

Generally it is seen that, Alibaba has had occasional difficulties regulating its sprawling eCommerce empire, which now includes online markets such as Taobao; Tmall, a platform for larger retailers linked to Taobao; group-buying site Juhuasuan and the original flagship platform, which links exporters with foreign buyers.

In the year 2011, was in headlines for scandal when sales staff colluded with professional criminals to defraud foreign customers, leading to multiple arrests and the resignation of then Chief Executive David Wei.

Alibaba was also publicly chastised by regulators for failing to control the sale of counterfeit products on its platforms, an accusation echoed by trade groups and regulators in the US, where the company is listed.

From Alibaba, US Securities and Exchange Commission had sought more information about a reported talk between its executives and China's State Administration for Industry and Commerce regarding sales of counterfeit goods, in February which the company did not mention in its IPO prospectus prior to listing, as reported by Reuters.

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