China cautions against online price wars

Country's Ministry of Commerce urges Web retailers to ensure marketing campaigns comply with laws after major operators embarked on price wars touting lower prices than competitors.

China's Ministry of Commerce calls on local online retailers to comply with existing market laws and protect consumers' and suppliers' interests after major operators initiated a price war on Wednesday.

According to China Daily on Thursday, major online operators such as 360buy, Suning, and Gome started offering huge discounts two days ago and claimed it was selling products at lower prices than its competitors. However, this has triggered concern among industry bodies and government agencies.

The Ministry of Commerce issued a statement on Thursday, expressing concern over the ongoing price war and reiterated retailers should subject their marketing strategies to existing laws and market rules. Shen Danyang, spokesperson for the ministry, said merchants should focus on boosting management and service while protecting the interest of consumers and suppliers.

The attempts by online retailers to carve a bigger market share comes as China pushes to develop its e-commerce industry. In its 12th Five-Year Plan, the country's Ministry of Industry and Information Technology said in March it plans to grow online shopping to 18 trillion yuan (US$2.86 trillion) by 2015 .



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