Compiled from: Southern Metropolis Daily
 
Case review
On the afternoon of October 8, the State Administration for Market Regulation announced the administrative penalty result of Meituan's "choose one of two" case—ordering Meituan to cease its illegal activities and imposing a fine of 3% of its 2020 sales revenue in China, which was 114.748 billion yuan, amounting to 3.442 billion yuan.

 
 

The "Administrative Penalty Decision" disclosed that from 2018 to 2020, Meituan took various measures to induce merchants on its platform to sign and execute exclusive cooperation agreements. For example, it charged higher commission rates and minimum commissions to non-exclusive cooperative operators; when signing exclusive agreements, it typically required platform operators to pay deposits ranging from hundreds to thousands of yuan.

According to the State Administration for Market Regulation, from 2018 to 2020, a total of 1.63 million platform operators signed exclusive cooperation agreements with Meituan and paid deposits, with the total deposit amount reaching 1.289 billion yuan. The administration ordered Meituan to fully refund these illegally collected exclusive cooperation deposits.

 

At the same time, the enforcement agency also issued an "Administrative Guidance Letter," requiring Meituan to improve its platform commission charging mechanism and algorithm rules, and to submit compliance self-inspection reports for three consecutive years to ensure rectification is fully implemented.
 
 
Anti-Monopoly Law of the People's Republic of China
Article 17: Undertakings with a dominant market position are prohibited from engaging in the following abusive conduct:
……
(4) Without justifiable reasons, restricting the counterparty to trade only with itself or only with a designated undertaking;
……
 
Article 47: Where an undertaking violates the provisions of this Law by abusing its dominant market position, the anti-monopoly enforcement authority shall order it to cease the illegal act, confiscate the illegal gains, and impose a fine of not less than 1% but not more than 10% of its sales revenue in the preceding year.
 
Article 49: When determining the specific amount of the fine under Articles 46, 47, and 48 of this Law, the anti-monopoly enforcement authority shall consider factors such as the nature, severity, and duration of the illegal act.

 

 
[1] The author's perspective
[2] It is worth noting that the relevant market in this case is defined as the online food delivery platform service market within China. This is because the enforcement agency believes that online food delivery platform services, offline dining services, and self-operated online food delivery services by restaurant operators do not belong to the same relevant product market. Taking online and offline as an example, from the perspective of consumer demand substitution analysis, food delivery platforms mainly meet consumers' needs for ordering food anytime, anywhere and dining "without leaving home," while offline dining services primarily satisfy consumers' demand for on-site dining experiences, including aspects such as dining venues, facilities and ambiance, in-person dining, and social interaction. The two also differ significantly in terms of product selection range and consumption methods.
 
[3] On the other hand, Meituan also holds a "pivotal" position in the market. After defining the relevant market, the enforcement agency demonstrated that Meituan holds a dominant position by examining factors such as market share, market concentration, market control capability, financial resources and advanced technology conditions, the degree of dependence of other operators in transactions, and the difficulty of entering the relevant market. Taking market share as an example, whether in terms of platform service revenue or platform food delivery order volume, Meituan's market share exceeds 50%, highlighting its massive user base. Additionally, after several rounds of financing, Meituan was listed on the Hong Kong Stock Exchange in 2018, with its market value growing from approximately 300 billion yuan in December 2018 to about 1.8 trillion yuan in December 2020, sufficiently proving that Meituan is an operator with market dominance.
 
[4] In fact, in recent years, the online platform economy has entered a period of rapid development, especially driven by network informatization and the pandemic, with effects being particularly pronounced. However, this has also been accompanied by issues such as platform monopolies and vicious competition. The most direct "choose one of two" behavior not only severely disrupts market competition order but also greatly reduces the platform's innovation and development capacity, as platforms shift their focus from innovative technology and improving business models to competing for merchant resources, which undoubtedly narrows their path forward. The government's intervention to address this is aimed, on one hand, at curbing monopolistic behavior to prevent the economy from sliding into a single, sluggish state or even a vicious cycle of competition; on the other hand, it is for long-term interests, guiding platforms toward technological reforms to make their development more dynamic and sustainable.