Economy
Most group purchase websites fail to get credit certificates
By Hu Yang (chinadaily.com.cn)
Updated: 2010-10-26 16:49
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Only about 20 group purchase websites got credit certificates out of the more than 300 applicants, according to the China International Electronic Commerce Center. The launch of a rating system for group buying business is aimed to regulate this newly-emerged business form and may weed out some the weaker companies now in the field.
The center, which is under the Ministry of Commerce, said it will carry out another round of credit certification this year and a second batch of websites will be approved by the end of December.
It's up to websites to decide whether they want to take part in the system or not, said Zhang Ge, a staff member at the center.
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The system is designed to rate group purchasing websites in an attempt to guide the market and will not force existing websites out, analysts said, but they believe some websites with limited capital and low rating will be weeded out by the market.
A person in charge of a group purchasing website told reporters that the registered capital threshold for applying websites is at least 500,000 yuan ($75,000).
By the end of August, China had 1,215 group pruchasing websites and the number is still surging rapidly, according to a report by the China e-Business Research Center. And market research company Analysis International predicted the market size will approach one billion yuan by the end of this year.
Along with the popularity of group purchasing are a growing number of consumer complaints and fraud cases involving group purchasing. The Beijing Business Today report said that other regulators, including the Ministry of Industry and Information Technology and the State Administration for Industry and Commerce, are also planning to introduce related regulations.