The name of the criticized company was not given, but by all indications it is competitor Meituan.
China’s leading e-commerce giant, JD.com, which entered the online food-delivery market in February, has denounced the return of notorious exclusive practices within the sector.
Earlier today, the company issued a public letter on its social media account, criticizing an unnamed online food-delivery platform for secretly engaging in long-condemned restrictive behaviors, commonly known as "choose one from two" in Chinese, which presses vendors and service providers to opt for one platform over another.
JD.com accused the competing platform of forcing delivery riders not to accept its instant-delivery orders, with the competitor warning that violations would result in punitive measures.
"In an effort to preserve its monopolistic position and serve its own commercial interests, the platform is once again enforcing the 'choose one from two' policy on millions of grassroots riders, drastically cutting their income,"
the statement read.
While the company did not disclose the competitor's name, the letter provided several clues.
JD.com highlighted that, for over a decade, the competitor has failed to pay insurances or housing funds for any delivery riders. It accused the competitor of exploiting riders through powerful algorithms and ignoring significant safety issues for the riders.
In addition, JD.com criticized the competitor for earning hundreds of billions in profits in an industry where over 60 percent of restaurants struggle to make money, showing little regard for the challenges faced by those in the food-services sector.
Furthermore, the company said that the competitor is driven by the excessive profits of ghost kitchens, which boast over 40 percent gross margins, and accused it of encouraging such operations to thrive without considering consumer food safety.
Coincidentally, two days earlier, one of the country's leading online food-delivery platforms, Meituan denied rumors that it forbids riders from taking orders from another unnamed platform. Meituan said that it has consistently been committed to providing riders with a fair and flexible working environment, fully respecting their right to choose their work platform freely.
China’s antitrust law, anti-unfair competition law, and e-commerce law all contain provisions to regulate such exclusivity issues, with the antitrust law typically having the largest deterrence through substantial punitive fines.
In 2021, the State Administration for Market Regulation, or SAMR, fined Meituan 3.44 billion yuan ($534 million) for imposing exclusivity requirements under the antitrust law.
While SAMR has yet to announce the completion of Meituan's rectification, it declared last August that another antitrust offender, Alibaba, completed its three-year compliance rectification. In 2021, SAMR issued administrative guidance to Alibaba and Meituan, requiring them to implement rectifications and submit annual compliance reports for three consecutive years, in addition to imposing record antitrust penalties.
Source: MLex
