[2] Compiled from: China Consumer News
 
On January 31, the Zhenjiang Municipal Market Supervision Administration issued an administrative penalty decision to Jiangsu Yuwell Medical Equipment Co., Ltd. (hereinafter referred to as Yuwell Medical), ordering it to correct price violations and imposing a fine of 2.7 million yuan.

 
 

Case review
At the end of 2022, the price surge of Yuwell's pulse oximeters triggered a consumer trust crisis. Some netizens revealed that the same model of Yuwell's pulse oximeter was "actually purchased for 94 yuan during the 88 shopping festival on the official website, but recently rose to 299 yuan," while others claimed that products ordered from Yuwell's official flagship store had reached the transfer station but were recalled...

 
 

In response to consumer doubts, Yuwell Medical replied that the recall was due to shipping errors, and regarding the price increase, it first stated that prices were set by the merchants themselves, then later said that due to increased costs and canceled discounts, product prices had risen. However, these responses were not accepted by consumers.
 
On January 17, 2023, the Zhenjiang Municipal Market Supervision Bureau filed a case to investigate the suspected price gouging by the party involved. After investigation, it was found that Yuwell Medical had the following pricing behavior: In November 2022, the average production cost of the finger-clip pulse oximeter (hereinafter referred to as the oximeter) model **306 produced and sold by Yuwell Medical was 43.8 yuan per unit (tax included, same below), and in December, the average production cost was 64.4 yuan per unit. In November 2022, the average price sold to its subsidiary Jiangsu Yuwell Network Technology Co., Ltd. was 100 yuan per unit. In December 2022, the average price sold to its subsidiary Jiangsu Yuwell Network Technology Co., Ltd. was 231.78 yuan per unit.
 
The Zhenjiang Municipal Market Supervision Bureau believed that starting from December 2022, Yuwell Medical took advantage of the tight market supply and demand situation, and despite a 47% month-on-month increase in the average production cost of oximeters, it significantly raised the sales price of the product, with the average sales price increasing by 131.78% month-on-month. The increase in sales price was significantly higher than the cost increase, driving the market price of oximeters to rise too quickly and too high, disrupting market price order.
 
According to Article 14 of the Price Law and Article 6 of the Administrative Penalties for Price Violations, the Zhenjiang Municipal Market Supervision Bureau held a case review meeting on January 30, 2023, to discuss the case collectively, deciding to order Yuwell to correct the price violations and impose a fine of 2.7 million yuan.
 
 
《[1] The People's Republic of ChinaPrice Law
Article 14
Business operators shall not engage in the following unfair pricing practices:
(1) Colluding to manipulate market prices, harming the legitimate rights and interests of other operators or consumers.
(2) Dumping goods at below-cost prices, except for the lawful price reduction of fresh goods, seasonal goods, overstocked goods, etc., in order to exclude competitors or monopolize the market, disrupting normal production and business operations, harming national interests or the legitimate rights and interests of other business operators;
(3) Fabricating or spreading price increase information, driving up prices, or causing excessive price increases for goods;
(4) Using false or misleading pricing methods to induce consumers or other business operators to engage in transactions;
(5) Applying price discrimination to other business operators with equivalent transaction conditions when providing the same goods or services;
(6) Using methods such as raising or lowering grades to purchase, sell goods, or provide services, thereby covertly increasing or reducing prices;
(7) Seeking exorbitant profits in violation of laws and regulations;
(8) Other unfair pricing practices prohibited by laws and administrative regulations.
 
 
[1] Provisions on Administrative Penalties for Price Violations
Article 6 
[2] If an operator violates Article 14 of the Price Law by selling, purchasing goods, or providing services through means such as raising or lowering grades, thereby covertly increasing or reducing prices, they shall be ordered to correct the behavior, have illegal gains confiscated, and be fined up to five times the illegal gains; if there are no illegal gains, a fine of not less than 20,000 yuan but not more than 200,000 yuan shall be imposed; if the circumstances are serious, the operator shall be ordered to suspend business for rectification, or have their business license revoked by the administrative authority for industry and commerce.

 
 

 
[1] The author's perspective
[3] Exploiting tense market supply-demand relations to drive up prices for profiteering is a common tactic many businesses use to amass wealth. However, during critical epidemic prevention periods, enterprises should recognize that people's livelihoods and society are the foundation of business development. Leading enterprises, in particular, should set a positive example rather than squander their reputation for petty gains, while also facing hefty administrative penalties.

[4] Since the initial shortage of masks and high-priced sales of disinfection products during the epidemic, the state and government have consistently emphasized stabilizing prices and safeguarding people's livelihoods. The public can accept price increases due to short-term supply-demand tensions, but they absolutely cannot tolerate businesses or individuals who exploit special circumstances to drive up prices, hoard goods, and profiteer. Such entities and individuals will be key targets of crackdowns by relevant authorities, face legal sanctions, and pay the due price.