In the current era of rapid digital economic development, the protection of consumer rights and interests has become particularly important. With the widespread adoption of online shopping and the diversification of online services, consumers face numerous challenges while enjoying convenience, such as false advertising, leakage of personal information, and unfair transactions. To further strengthen the protection of consumer rights and interests and to establish a fair, transparent, and safe consumption environment, the Regulations on the Implementation of the Law of the People's Republic of China on the Protection of Consumer Rights and Interests (hereinafter referred to as the "Regulations") were adopted on February 23, 2024, and came into effect on July 1, 2024. The Regulations provide provisions on new areas and issues of great concern to consumers, including prepaid consumption, live-streaming e-commerce, personal information protection, "unfair clauses," and "big data-enabled price discrimination against existing customers."

Prohibition of Big Data-Enabled Price Discrimination Against Existing Customers

With the continuous development of science and technology, such as artificial intelligence and big data models, merchants who possess vast amounts of consumer consumption information can predict the maximum price a particular consumer is willing to accept for a given product based on that consumer's behavioral patterns, thereby maximizing profits. This phenomenon is known as "big data-enabled price discrimination against existing customers."

Case: Mr. Wu is a business professional who frequently travels. He habitually uses a well-known online travel platform to book flight tickets. One day, he planned to book a round-trip ticket from Shanghai to Beijing for an upcoming business meeting. To ensure he obtained the best price, Mr. Wu decided to search for the price of the same flight ticket during the same time period using both his regular account (a premium member account) and a newly registered ordinary account. However, the search results were surprising: the round-trip ticket price displayed for the premium member account was 3,000 yuan, while the price for the same flight found using the newly registered account was only 2,600 yuan, a difference of 400 yuan. Mr. Wu was puzzled by this, as common sense suggests that premium members should enjoy more benefits, not higher prices. Mr. Wu immediately contacted the customer service of the online travel platform to inquire about the reason for this discrepancy. The customer service representative replied that the platform uses dynamic pricing based on various factors such as the user's search history, purchase frequency, and membership level, but remained evasive when asked why premium members were charged a higher price.

In the aforementioned case, the travel platform's act of increasing the ticket price for premium members without justifiable reason clearly constitutes price discrimination against consumers, infringing upon Mr. Wu's legitimate rights and interests. To properly address this situation, the Regulations stipulate that business operators shall not, without the consumer's knowledge, set different prices or fee standards for the same goods or services under equivalent transaction conditions. Mr. Wu's case is not an isolated incident. With the continuous development of artificial intelligence and big data technologies, similar acts of price discrimination may occur in various fields. Therefore, the enactment of the Regulations holds significant practical importance. It not only provides legal protection for consumers but also encourages business operators to use big data technology more normatively, ensuring fair market competition and the legitimate rights and interests of consumers.

Regulating the Chaos in Live-Streaming E-Commerce

With the rise of the "live-streaming" marketing model, consumers are increasingly making purchases and buying daily necessities through live-streaming platforms. However, this has been accompanied by an increase in legal disputes related to live-streaming e-commerce transactions. The Director of the Law Enforcement and Inspection Bureau of the State Administration for Market Regulation stated that in the past five years, the scale of China's live-streaming e-commerce market has grown by 10.5 times, while the growth rate of complaints and reports has surged by 47.1 times, significantly higher than that of traditional e-commerce. To fully protect consumer rights and interests and to rectify the current chaos on live-streaming platforms, the Regulations have introduced many innovative regulatory provisions targeting the specific characteristics and prominent issues of live-streaming.

In response to the current situation of "chaotic promotion" in live-streaming e-commerce, the Regulations explicitly stipulate that hosts and live-streaming platforms must adhere to the principles of truthful, accurate, and complete information disclosure when promoting goods or services. Business operators providing goods or services through the internet, television, telephone, mail order, or other means shall clearly indicate or explain their true name and mark on their homepage, video screens, audio, product catalogs, etc., in a conspicuous manner.

For live-streaming platforms, the Regulations require them to assume stricter regulatory responsibilities. Operators of live-streaming marketing platforms shall establish and improve consumer rights protection systems and clearly define consumer dispute resolution mechanisms. In the event of a consumer dispute, the live-streaming platform operator shall, upon the consumer's request, provide relevant information about the live-stream room operator and the live-streaming marketer, as well as necessary information such as records of related business activities.

Finally, the Regulations also set forth provisions regarding marketing activities in live-streaming e-commerce. Currently, relevant regulations such as the Advertising Law of the People's Republic of China impose different requirements on goods such as food and health products. However, since live-streaming platforms are not bound by the restrictions applicable to advertising platforms, they often circumvent the relevant limitations of the Advertising Law to achieve promotional effects for goods. To eliminate this phenomenon, the Regulations require that live-stream room operators and live-streaming marketers, for live-stream content that constitutes commercial advertising, shall fulfill the obligations of an advertisement publisher, advertisement operator, or advertisement endorser in accordance with the relevant provisions of the Advertising Law of the People's Republic of China.

Crackdown on "Unfair Clauses"

Due to the advantageous position of business operators over consumers, they often "set traps" in contracts signed with consumers, thereby causing consumers to face numerous obstacles when seeking to protect their rights, even if their rights and interests have been infringed upon.

Mr. Zhang, a consumer in Shanghai, purchased an online education service through a well-known internet platform, which was provided by a company located in Beijing. During the purchase process, Mr. Zhang completed all purchase procedures as prompted by the website and did not notice a standard-form clause in the service agreement concerning dispute resolution, which stipulated: "All disputes arising from or in connection with this Agreement shall be submitted to the Beijing Arbitration Commission for arbitration in accordance with its arbitration rules." After the service commenced, Mr. Zhang discovered that the course content was seriously inconsistent with the promotion and that the teaching quality was poor. He therefore requested a refund and compensation. After failing to reach a resolution through communication with the merchant, Mr. Zhang decided to take legal action to protect his rights. It was only when he prepared to file a complaint with the local consumer protection agency in Shanghai and considered initiating litigation that he first noticed the jurisdiction clause in the service agreement. If this dispute resolution clause were to take effect normally, Mr. Zhang would only be able to file an arbitration application with the Beijing Arbitration Commission, which would unreasonably increase the cost of his rights protection.

To protect the legitimate rights and interests of consumers facing the same issue as Mr. Zhang, the Regulations stipulate that business operators shall not use standard-form clauses to unreasonably exempt or mitigate their own liability, increase consumers' liability, or restrict consumers' rights to modify or terminate contracts in accordance with the law, to choose litigation or arbitration for resolving consumer disputes, or to select goods or services from other business operators. According to the relevant provisions of the Civil Code, disputes arising from sales contracts, as actions for breach of contract, may generally be under the jurisdiction of the people's court at the domicile of the defendant or the place of contract performance. For online consumption, which occupies a dominant market position, the courts at the buyer's domicile and the place of receipt of goods both have jurisdiction. To increase consumers' costs of rights protection, some business operators often use standard-form clauses to stipulate arbitration or the operator's location as the jurisdiction. Therefore, the Regulations require that business operators shall not use standard-form clauses to unreasonably restrict the choice of litigation or arbitration for resolving consumer disputes. In this case, Mr. Zhang may request the court to confirm the invalidity of the standard-form clause concerning dispute resolution, thereby reducing the cost of rights protection.

Gym "Closure and Abandonment"?

With social development, services such as gyms and barbershops have gradually become an indispensable part of residents' daily lives. Providers of these services often offer a "prepaid card" consumption model: consumers pay a certain amount of money in advance to the business operator, who then provides goods or services to the consumer in installments over a specified future period in accordance with the contract. However, disputes arising from the inability to refund prepaid cards due to such merchants closing down and absconding are not uncommon.

Case: Ms. Wang, a fitness enthusiast, purchased a two-year gym membership at a well-known chain gym in March 2023 for RMB 5,000 to facilitate her exercise routine. At the time of purchase, the gym staff promised her first-class fitness equipment and quality services, which left her highly satisfied. However, this did not last long. In June 2023, when Ms. Wang went to the gym as usual, she found the doors locked and the equipment cleared out, indicating that the gym had ceased operations. She immediately attempted to contact the gym staff, but their phone numbers were unreachable, and their WeChat and other contact methods had been blocked. Further investigation revealed that the gym had been subject to multiple complaints and disputes prior to its closure. Faced with the sudden shutdown and disappearance of the gym, Ms. Wang and other members felt helpless and outraged. They not only lost their venue and opportunity to exercise but also wasted thousands of yuan in membership fees. Although they attempted to seek legal recourse, their efforts were extremely challenging due to insufficient evidence and the gym's dissolved legal entity status.

To prevent the above situation, the Regulations stipulate that if an operator faces significant operational risks that may affect its ability to normally provide goods or services in accordance with the contract or trading practices, it shall cease collecting advance payments. If an operator decides to close its business or relocate its service premises, it shall notify consumers in advance and fulfill the obligations set forth in Article 21 of these Regulations. In accordance with relevant state regulations or the contract, consumers have the right to demand that the operator continue to perform its obligation to provide goods or services, or to demand a refund of the unused prepaid balance.

The aforementioned provisions, to a certain extent, offer a solution to the problem of "difficulty in rights protection" in prepaid card disputes, by explicitly requiring service providers to cease collecting advance payments when facing significant operational risks that may affect the normal provision of goods or services, and to ensure that, when deciding to close or relocate service premises, they notify consumers in advance and fulfill the obligations stipulated in Article 21 of these Regulations. These provisions not only enhance the protection of consumers' rights and interests but also serve as a warning to service providers.

Harassing Telemarketing Calls

The Regulations stipulate that without the consumer's consent, an operator shall not send commercial information or make commercial calls to the consumer. If a consumer consents to receive commercial information or commercial calls, the operator shall provide a clear and convenient method for cancellation. If the consumer chooses to cancel, the operator shall immediately cease sending commercial information or making commercial calls. A peaceful life is an inherent aspect of the right to privacy and represents the most basic respect an operator should afford to consumers. Without the consumer's consent, an operator shall not arbitrarily obtain or use the consumer's personal information to send commercial information or make commercial calls.

Conclusion

The enactment and implementation of the Regulations on the Implementation of the Law of the People's Republic of China on the Protection of Consumer Rights and Interests mark a solid step forward in the field of consumer rights protection in China. These Regulations provide clear legal norms and guidance for emerging issues and challenges in the digital economy era, such as big data-enabled price discrimination against existing customers, chaos in livestreaming e-commerce, and risks associated with prepaid card consumption. They not only strengthen the responsibilities and obligations of operators but also provide consumers with more comprehensive and robust protection of their rights and interests. By regulating market order and combating illegal activities, these Regulations will help build a fairer, more transparent, and safer consumption environment, further enhancing consumer satisfaction and trust.