Guiding Opinion on Investigating Illegal Price Hikes During Period of Prevention and Control of the Novel Coronavirus Pneumonia Epidemic



Promulgation Date: 2020-2-1
Title: 市场监管总局关于新型冠状病毒感染肺炎疫情防控期间查处哄抬价格违法行为的指导意见
Document Number:国市监竞争﹝2020﹞21号
Expiration date: 
Promulgating Entities:State Administration for Market Regulation
Source of text:


To the Bureau (department, commission) of market regulation for each province, autonomous region, directly-governed municipality, and for the Xinjiang Construction and Production Corps:

In order to ensure the stability of market pricing during the period of prevention and control of the novel coronavirus pneumonia (hereinafter the 'epidemic') for masks, anti-viral drugs, disinfectants, and anti-bacterial goods, related medical instruments, and other prevention gear, as well as daily goods for the public such as staple foods and other essentials, to strengthen and regulate all levels of departments for market regulation in their investigation of price hiking violations, the following Guiding Opinions are made in accordance with the "Pricing Law", the "Provisions on Administrative Punishment of Ilegal Pricing Conduct" and other relevant laws and regulations:

I. Businesses must not fabricate and spread information on price increases for disease prevention goods and household goods. Where businesses have any of the acts of fabrication or spreading information, they may be found to have constituted the violation of price hiking as provided for in article 6(1) of the "Provisions on Administrative Punishment of Ilegal Pricing Conduct".

II. Businesses with any of the following circumstances may be found to be fabricating information on price increases.

(1) making up the costs of stock;

(2) making up local shortages or inflating market demand;

(3) pretending that other businesses have already raised prices or are about to;

(4) Inventing other information that might push up expected prices of disease prevention goods or household goods.

III. Where businesses have any of the following circumstances, they may be found to have spread information on price increases:

(1) spreading fabricated information on price increases;

(2) Spreading information that is not fabricated but using urgent or enticing language such as 'serious shortage' or 'prices soon increasing across the board' to push up expected prices:

(3) spreading opinions, appeals, or enticements for other businesses to raise prices;

(4) Spreading other information that might push up expected prices of disease prevention goods or household goods.

IV. Business that have any of the following circumstances may be found to have illegally hiked prices as provided for in article 6(2) of the "Provisions on Administrative Punishment of Ilegal Pricing Conduct‘’ 。

(1) Businesses producing disease prevention goods or raw materials for disease prevention goods do not promptly put goods they have already produced on the market, and continue hoarding after being admonished by the departments for market regulation;

(2) Wholesale businesses do not promptly put goods for disease control and household goods in circulation to end consumers and continue hoarding after being admonished by the market regulation departments.

(3) Retail businesses do not promptly put relevant goods out for sale for reasons other than storage necessary to keep up business continuity, and continue hoarding after being admonished by the market regulation departments.

Where production or wholesale businesses can prove that their having the circumstances in items (1) or (2) of this article is for material reserves or planned allocation in accordance with government or relevant departments' requests, it does not comprise illegal acts of price hiking.

For retail businesses, where market regulation departments have already used methods such as public announcements and issuing reminders and warnings to uniformly warn businesses that they must not illegally hoard, it is to be viewed as having lawfully performed procedures for giving warnings, and they may choose not to issue warnings again and directly find businesses that are hoarding have constituted price hiking violations.

V. Businesses that have any of the following circumstances may be found to have constituted the price hiking violations provided for in article 6(3) of the "Provisions on Administrative Punishment of Ilegal Pricing Conduct‘’

(1) Compelling the sale of other goods during sales of disease prevention goods, covertly increasing the price of the goods for disease prevention.

(2) Not raising the prove of goods for disease prevention or household goods, but widely increasing associated fees or collecting other fees;

(3) Businesses sell the same item for more than the net price differential of the final actual transaction before January 19 (including that date);

(4) Where there were no actual sales before the epidemic occurred, or it is impossible to verify actual transactions from before January 19, and businesses raise prices by a large margin over the basic cost of supply, and they do immediately make corrections after being warned by the departments for market regulation.

Where businesses have the circumstances in item (3) of this article but have not caused actual harmful consequences, and they do not immediately make corrections upon being warned by the market regulation departments, a lighter or commuted punishment may be given or punishment may be waived.

The "large margin" as used in item (4) is to be specifically determined by the market regulation departments by a comprehensive consideration of factors such as the businesses' actual business circumstances, subjective malice, and the extent of harm the violation caused to society, taken together with the actual condtions.

VI. In the following circumstances, the market supervision departments may treat price hiking violations as if they are not unlawful gains.

(1) There were no legal receipts of sales or fee collection;

(2) receipts of sales or fee collection are concealed or destroyed;

(3) Concealment of sales, or discrepancies between the account books and the amounts on receipts makes it so there is no basis for calculating the value of unlawful gains;

(4) Where actual transaction amounts are too low but the circumstances of the violation are heinous;

(5) Other situations where unlawful gains cannot be accurately verified.

VII. Where the following situations occur, the departments for market regulation shall give administrative punishments in accordance with the provisions on more serious or serious punishment in article 6 of the "Provisions on Administrative Punishment of Ilegal Pricing Conduct‘’ for price hiking violations where there are no unlawful gains or that are viewed as having no unlawful gains; where businesses unlawful gains can be correctly calculated, heavy punishments are to be given.

(1) fabricated or spread false information on the spread of the epidemic or on prevention and treatment, causing panic in the population and pushing up price expectations;

(2) Simultaneously using multiple tactics to hike prices;

(3) Price hiking continues for a relatively long time, or has a wider impact;

(4) Had other pricing violations in addition to price hiking;

(5) Had two or more price hiking violations during the period of epidemic prevention and control;

(6) Concealed or destroyed relevant evidence or provided fake materials;

(7) Refusing to cooperate with lawfully-conducted pricing oversight inspections.

(8) Other circumstances that should be found to be more serious or serious.

VIII. Where businesses violate the pricing intervention measures implemented by provincial-level people's governments regarding price disparities, profit rates, or pricing, and it constitutes a violation for failure to carry of pricing intervention measures, it is not to be investigated as a price hiking violation.

IX. Where the departments for market regulation discover that price hiking violations constitute crimes, they shall lawfully transfer them to the public security organs.

X. Based on these opinions, and upon approval of the local provincial-level government, each provincial, autonomous region, and directly-governed municipality department for market regulation may put forward specific standards for determining price hiking violations, as well as lawfully simplifying the detailed enforcement procedures, and file these with the State Administration of Market Regulation (Pricing and Competition Bureau). Where prior to the issuance of these Opinions, provincial-level departments for market regulation or other relevant departments have already issued specific provisions on the designation of price hiking offenses with the approval of the provincial-level people's government, continue to enforce them.

XI. From the date on which the relevant departments announce that the epidemic is over, enforcement of these Opinions automatically concludes.

State Administration for Market Regulation

February 1, 2020


About China Law Translate 1216 Articles
CLT is a crowdsourced, crowdfunded legal translation project that enables English speaking people to better understand Chinese law.

Be the first to comment

Leave a Reply

Your email address will not be published.