Screenshot of Beijing Municipal Administration for Market Regulation's official WeChat account

Consumer associations in Beijing, Tianjin and Hebei Province summoned the domestic operator of international hotel brand InterContinental Hotels Group (IHG) for talks on Wednesday after some of its membership terms were suspected of infringing on consumers' legitimate rights and interests, media outlets including the Beijing Daily reported.
 
According to a release by the Beijing Municipal Administration for Market Regulation on its official WeChat account on Wednesday, the Beijing Consumers' Association, the Tianjin Consumers' Association and the Hebei Consumers' Rights Protection Committee have had talks with InterContinental Hotels Group Liuzhou Hotel Management (Shanghai) Co, the domestic operator of IHG, and put forward clear rectification requirements for the company.

According to the notice, multiple clauses in IHG's membership terms on the company website and app were suspected of infringing upon consumers' legitimate rights, including excluding Chinese law from jurisdiction, forcing Chinese consumers to seek arbitration abroad, restricting consumers' right to collective rights protection, arbitrarily changing contract terms, and refusing to be liable for any losses caused by the use of goods.

The notice said that the associations acted under regulations on the implementation of the consumer rights protection law and in accordance with the relevant procedures for handling the business operators.

IHG's standard terms and conditions are suspected of being illegal and restricting consumers' rights, said the notice.

The joint investigation identified two broad categories of problems. First, the membership terms reportedly include mandatory arbitration clauses that require Chinese consumers to pursue arbitration outside China and to accept foreign law, while excluding litigation options and effectively limiting consumers' ability to pursue collective redress. 

Second, the clauses were said to impair core consumer rights such as the right of choice, the right to fair transactions, and the right to seek compensation - for example, by permitting unilateral contract changes and overly broad liability exemptions that absolve the operator of responsibility for losses caused by the use of goods or services, according to the announcement. 

The associations have asked the company to conduct a comprehensive review and revise its membership terms within a fixed timetable. They requested deletion or amendment of provisions that exclude consumers' litigation rights, force overseas arbitration, apply foreign law to disputes, or contain excessive unilateral exemptions and other unfair or unreasonable language, and urged IHG to ensure the contract terms conform to the principles of fairness.

The associations said that they will monitor IHG's response, continue oversight of unfair standard-form contract terms, and take firm steps to protect consumers' lawful interests.

IHG did not publicly respond to the matter on Wednesday. IHG shares closed down 2.11 percent at $132.02 on that day, Jiemian News reported.

IHG has gained a large number of customers in the Chinese market. Meanwhile, the fairness and legality of its standard terms and conditions have attracted widespread attention, said the announcement.

Global Times