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E-commerce draft weighs platforms' liability

By CAO YIN | China Daily | Updated: 2018-08-31 07:06
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Sales personnel at an e-commerce store in Nantong, Jiangsu province, print express delivery receipts. XU PEIQIN/XINHUA

China's top legislature was asked on Thursday to strengthen a liability clause in the latest draft of the e-commerce law to better protect consumers and prevent platform operators from becoming too powerful.

The draft, which is being deliberated by the Standing Committee of the National People's Congress, sparked a debate by lawmakers and legal experts over a change in the liability provisions after it was submitted to the top legislative body for the fourth reading on Monday.

The latest draft reduces the liability of e-commerce platforms in cases where they fail to properly review the qualifications of those selling goods or providing health or lifestyle services, or if they fail to protect consumers' safety.

Some legislators were concerned about the change when reviewing the draft, saying that it would weaken consumer protections and make e-commerce platform operators more powerful.

On Thursday, the NPC Constitution and Law Committee suggested that lawmakers should increase operators' responsibility.

Xu Xianming, a member of the NPC Standing Committee, said the softer language took the legislation backward and that platforms should face higher standards.

The change reduces the liability of e-commerce platforms to what is called "supplementary liability", rather than "joint liability".

Joint liability refers to both the product seller and the e-commerce platform. Consumers who suffer damages would be allowed to sue sellers and platforms together. By contrast "supplementary liability" means consumers can only sue the seller of the goods in that situation, Xu said.

Cai Fang, another member of the Standing Committee, said adding protection for consumers is a priority.

The China Consumers Association also expressed concern about the latest draft, saying e-commerce platform operators' liability would be reduced greatly if the draft passes as written, according to a report in China Consumer News on Thursday.

"Joint liability can help fight fake products online, especially food or medicines that harm people's health," an official of the association told the paper. "It can push the platform operators to shoulder their responsibility and adapt to society's demands."

Zhu Wei, an associate law professor at China University of Political Science and Law, said awareness about protecting consumers' rights and health shouldn't be weakened, though some e-commerce platforms have complained that they have suffered unfairly in lawsuits brought under joint liability.

"When there are difficulties with sellers of goods online, asking the platform operators to pay compensation first is the better way to protect our rights," he said.

But Xue Jun, a law professor at Peking University, said the draft does, in fact, highlight protection for consumers.

He said liability for e-commerce platform operators should depend on the specific facts of a case, adding that imposing other obligations for online safety protection needs more study.

The legislature said on Monday that drafting the e-commerce law aims to protect the interests of all e-commerce participants, regulate conduct to maintain market order and improve the sustainable and sound development of e-commerce.

As the world's largest e-commerce market, China saw its online retail sales grow 32.2 percent year-on-year in 2017 to reach 7.18 trillion yuan ($1.05 trillion).

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