China proposes expanding scope of e-commerce law and revising platform rules

The Chinese government has released draft amendments to the E-commerce Law aimed at significantly changing the legal framework of the country's digital trade ecosystem. According to official announcements from Peking, the proposed amendments aim to expand the scope of existing laws to cover not only platforms and sellers, but a much wider range of stakeholders in the sector. This move is described as a strategic step to strengthen supervision mechanisms and close legal loopholes in the rapidly growing e-commerce market in China. The current law has faced criticism for being inadequate in the face of technological developments and new business models since it came into force. With these recent adjustments, the aim is to increase the enforceability of the law and place the legal responsibilities of all actors in the digital economy into a clearer framework.

The most striking aspect of the draft amendments is the expansion of legal protections and oversight, which will no longer be limited to pre-defined specific platform and seller groups. Authorities state that the purpose of this expansion is to better reflect the complexity of the e-commerce sector's structure and to cover the entire chain, including intermediary service providers. New venture models that currently look like big e-commerce giants but have legal uncertainties will be brought within the bounds of legal authority with these changes. This means that not only sellers and platforms, but also logistics, payment systems, and related service providers will fall within the scope of the law and need to comply. The regulation also plans to eliminate legal uncertainties in the sector by including commercial methods used other than the marketplace model in the legal classification.

The proposed legal changes include a radical review of the rules regarding platforms' content management and operations. The draft text redefines responsibilities across a wide spectrum, from the processing of user data by platforms to the protection of consumer rights and the competitive conditions of sellers. Experts predict that these changes could increase pressure on major technology companies and alter market behavior. In particular, rules to be imposed on platforms' internal commercial practices, search algorithms, and behavior towards small businesses have the potential to disrupt sector balances. It seems certain that companies will need to review their business models and operational processes to comply with these new rules.

Industry representatives and legal experts expect intensified discussions and detailed negotiations during the process of the draft becoming law. Since the e-commerce sector in China is one of the largest and fastest-growing markets globally, the legal changes to be made will also have indirect effects on global trade. It is being closely monitored how the regulations will affect the entry of foreign companies into the Chinese market or their existing business models. While consumer organizations welcome the regulations for a more transparent and secure market, business representatives voice their concerns regarding costs and bureaucratic burdens. It is planned for the draft to enter into force after approval by the Central Committee of the Communist Party of China and the State Council, and it is stated that this process may take time.