Chinese consumer group calls for strengthened regulation over platforms' algorithm application
Published: Jan 08, 2021 10:20 AM

Photo: VCG

Chinese Consumer Association (CCA) said it will strengthen regulations over online retailing algorithms to protect consumers' right of fair trade. It also urged internet platforms to strengthen self-regulation, avoid consumption discrimination and one-sided consumption induction.

The call sends a stern warning to various internet platforms whose business models are algorithm-driven including Douyin, owned by ByteDance, Meituan Dianping, Didi Chuxing and other e-commerce platforms, making them reflect on why they would opt to hunt for a quick profit on unsustainable development models over investing in the future, industry observers said. 

The comment was made at a forum organized by CCA in Beijing on Thursday. At the forum, CCA noted that some internet platforms have been abusing their algorithms - which are supposed to improve operating efficiency to offer more diversified and high-quality services - to "bully" consumers or even distort their values and moral ideas. 

For example, some platforms recommend products based on consumers' searching and viewing history, which can impinge on consumers' right of choice. Also, operators tend to display different products prices based on their algorithms, showing members more expensive items than regular consumers.

"The unfair algorithm application is invisible but affects consumers' purchases unconsciously. If developed in a disorderly way, it is not conducive for fair competition in the market or sustainable development of the economy," CCA said in a statement on its website.

In response, CCA urged platform operators to uphold the principle of comprehensiveness and fairness in the use of algorithm technology. It stressed that the application should be in line with socialist core values to maintain public social order and good customs. 

Meanwhile, it also urged Chinese lawmakers to establish rules concerning the application of algorithm technology, such as regulating that when consumers search for the same public options, they shall receive the same results.

Different departments should also strengthen coordination with one another, as the application of internet algorithms covers a wide range of areas, according to CCA. 

Li Yi, a senior research fellow at the Internet Research Center of the Shanghai Academy of Social Sciences, told the Global Times on Friday that if China's algorithm-driven internet firms do not remedy their wrongdoings, Chinese regulators would probably take action to penalize them in the next step.

 "China's internet companies are developing too fast, with some already going astray to pursue quick gains. Therefore, top-down correction is necessary and will benefit the industry's long-term development," Li noted.

Chinese authorities will intensify anti-monopoly supervision and unfair competition, while preventing disorderly capital expansion in 2021, according to a statement released after the annual Central Economic Work Conference in December. 

Global Times

blog comments powered by Disqus