China targets Alibaba, JD.com, other platforms with new rules

China has introduced new regulations targeting major online platforms, including Alibaba, JD.com, and Meituan, to curb aggressive ecommerce practices and protect merchants.

Starting February, the rules ban platforms from forcing merchants to join promotions and prohibit online influencers from making false claims.

The guidelines were issued by the State Administration for Market Regulation and the Cyberspace Administration of China.

Alibaba’s Hong Kong-listed shares fell as much as 4.2% after the announcement, with similar losses in JD.com, Meituan, and Kuaishou.

Chinese authorities have stepped up oversight since 2025 as companies ramped up subsidies in a slowing retail market.

The rules also require platforms to protect consumer rights and user data, with violations subject to fines.

🔗 Source: Bloomberg

🧠 Food for thought

Implications, context, and why it matters.

Ban on forced merchant promotions lacks clear enforcement

The new guidelines ban platforms from forcing merchants into promotions. The notice did not define coercion, such as traffic throttling, delisting, or boosted exposure for compliant sellers. This leaves enforcement muddy.
Officials mentioned warnings and fines for violations. They did not set penalty tiers tied to revenue or thresholds, which could let platforms use algorithmic ranking (how they order search results or feeds) for indirect pressure.
China often refines rules over time. The Cybersecurity Law, a foundational framework for network and data security, is being amended with higher penalties, so these rules may change as enforcement exposes loopholes 1.

Software-as-a-service (SaaS) vendors should plan for spend shifting to private domain tools

With regulators curbing platform tactics and acquisition costs high, brands will invest more in owned channels, often called private domain in China. Examples include WeChat mini-programs (lightweight apps inside the WeChat super-app) plus customer relationship management (CRM) systems 2.
WeChat’s full-domain operations strategy coordinates content, chat, stores plus payments across public and private touchpoints. This positions it to gain as merchants seek options beyond heavy platform spend 2.
Vendors that offer automation, analytics, plus customer data management software for private traffic will see rising demand as merchants build direct-to-consumer ties 2.
Starting Oct 1, 2025, platform companies (large ecommerce and social-commerce platforms in China) must submit operators’ and employees’ identity and income data to tax authorities. The first quarterly file for Q3 2025 is due Oct 31, which could raise compliance burdens 3.