Shanghai regulator holds meeting on price gouging

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The Shanghai market regulator convened a dozen e-commerce companies, including food delivery platforms Meituan and eleme.me, to discuss a range of topics, including rising prices during the coronavirus pandemic. COVID.

As Reuters reported on Monday (April 18), the regulator has asked platforms to improve how they handle delivery people and reduce practices such as inappropriate price increases by riders.

See also: Congress plans to give federal regulators more tools to fight pandemic-related scams and price gouging

Rising prices have also been a problem in the United States. In February, Sen. Richard Blumenthal (D-Conn.) said his office had received 800 price gouging reports in his home state of Connecticut and insisted that the federal government’s lack of regulation had contributed to the problem.

“There is a glaring lack of enforcement at the federal level,” Blumenthal said during a hearing in early February. “The federal government, including the Federal Trade Commission and the Department of Justice, has few legal tools to hold crooks accountable.”

Related: PBOC pledges loans to protect supply chain

The meeting comes as China faces increased supply chain disruptions in Shanghai – home to the world’s largest container port – following COVID shutdowns. Congestion at ports and road checks have extended delivery times, lowered production and reduced consumption, making China’s 5.5% annual growth target difficult.

As PYMNTS reported last week, the People’s Bank of China (PBOC) has pledged financial support for trucks and logistics companies amid the country’s worst COVID outbreak in two years. The move is designed to strengthen China’s supply chain, with the central bank asking lenders to “reasonably” extend and renew loans for the sector.

Read more: Meituan loses $26 billion in value as Chinese regulators intervene

Earlier this year, Meituan said it lost $26 billion in value after regulators called for a reduction in the fees food platforms charge restaurants. The company controlled about 70% of the food delivery market in China, and the segment contributed more than half of its revenue in the third quarter.

China National Development and Reform Commission (NRDC) said his goal was to get delivery platforms to “go a step further to reduce service fees charged to restaurants to reduce their operating costs”, adding that he also wanted to ask platforms to reduce restaurants in areas hardest hit by COVID.

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