Chinese regulators have summoned food delivery giants JD.com, Meituan and Alibaba Group Holding’s Ele.me to address intensifying competition in the sector, urging legal compliance and fair practices.
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The meeting of five government agencies, led by the State Administration for Market Regulation (SAMR), aimed to “address the salient issues in current competition of the food delivery industry”, according to a Tuesday statement posted online by the SAMR. The other agencies involved in the meeting oversee social work, the internet, human resources and commerce.
Authorities called on the platform operators to adhere to China’s e-commerce, competition and food safety laws, while strengthening internal operations to “effectively protect the legitimate rights and interests of consumers, [restaurant] operators and delivery riders”, the SAMR said.
News of the meeting quickly gained traction online, becoming the sixth-most trending topic on microblogging platform Weibo on Wednesday morning.
The Hong Kong-listed shares of JD.com, Meituan and Alibaba gained 2.9, 1 and 1.6 per cent, respectively, in Wednesday morning trading, as investors bet on an easing of fierce price competition.
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The battle between JD and Meituan turned ugly last month in a bitter war of words, each accusing the other of unfair practices. The feud wiped US$13 billion off the combined market capitalisation of the two companies in a week.