Electricity Dealer price war law is the bottom line

August 14 Jingdong Mall and Suning appliances (002024, shares bar) on Weibo announced the price war, and then Gome joined in to form a three-party melee situation. The parties continue to announce a variety of data, such as Jingdong Mall announced that the price of suning appliances than 10%, and Gome and announced to be lower than Jingdong mall 5%. How do you get the data? Is it reliable? Can it be done? Whether it will be illegal, such as suning appliances, if the cost price sales, Jingdong Mall again Lower 10% is the "anti-unfair competition law" prohibited dumping behavior? If the light say not practice, fabricate all sorts of data to deceive consumer to consume, whether constitute price fraudulent behavior under the price Act? This article is willing to answer all these questions.

China's laws protect legitimate market competition behavior, there is competition in the market, but not all of the competition is legitimate, in the interests of the driving of various unfair competition behavior abound. These unfair competition behavior sometimes appears to be advantageous to the consumer, but actually disturbs the market order, but also harms the consumer's interest. In this respect, China has enacted the "anti-unfair competition law" to encourage and protect fair competition, to stop unfair competition, to protect the legitimate rights and interests of operators and consumers, to ensure the healthy development of market economy.

Article 11th of the Anti-Unfair Competition Act provides for the prohibition of dumping. The article stipulates: "The operator shall not sell the goods at a price below the cost for the purpose of crowding out competitors." "Dumping is prohibited in many countries, and the United States and Germany have relevant regulations." Two elements are required to constitute a dumping act:

First, the objective element is to crowd out competitors. Like Jingdong Mall, Gome, Su ning such a head-to-head price war, is certainly to crowd out competitors for the purpose, this is beyond doubt. But in many cases, whether to crowd out opponents or to make judgments. Some things are not like the electricity dealer "price war" such parties announced the war, and said so clearly, many times is a high-profile price reduction but do not specify the purpose. This situation requires a combination of other kinds of evidence to be judged.

Second, the behavioral element, that is, to sell goods at a price below the cost. What is sales below cost price? This is a complex issue, not only a legal issue, but also a question of economics. In the 90 's, Gome has been known for its low price sales, but the strategy of Low-cost sales is still profitable, and its sales and profits are increasing year in, indicating that this low price is legitimate, not the "anti-unfair competition law" under the cost price. For Jingdong Mall, Gome, suning, such as commodity circulation enterprises, the cost of their product accounting is a very important, very complex problem. In general, the regulatory authorities will take a cautious approach, unless the enterprise is clearly below the cost price of sales (such as below the cost price of 10%), or will leave the problem to the market. Just like the electric dealer "price war", there is no management department to explicitly say which electrical appliances business is below the cost price sales. It should be said that the majority of Chinese enterprises to reduce prices are legitimate, but do not rule out in order to crowd out competitors and may appear some operators dumping behavior.

In addition, not all acts below the cost price are prohibited by law, and in some exceptional cases the law is still allowed to be sold below cost. These are:

1, sales of fresh goods. The value of live goods is "fresh", if not in the fresh time to sell out, the loss will be very large, because the price gap between fresh and fresh is huge. As a result, the law allows sales of fresh goods to be sold at a price lower than the cost.

2, to deal with the expiry of the expiration of the goods or other backlog of goods. Expiration means that the goods will not be available in the market, so the expiring goods are allowed to be sold below the cost price. The backlog of goods is faced with the problem of cash-out and expiration, so it is also allowed to sell below the cost price.

3. Seasonal price reduction. Some commodities are seasonal, for example, down jacket is usually sold in winter, but the goods may not be able to sell in the season, if again waiting for the next season will require a lot of time and opportunity costs, and the reverse season sales because of the low demand is bound to reduce prices. Therefore, seasonal price reduction is the inevitable demand for businesses to reduce losses, the law allows sales below the cost price.

4, due to the liquidation of debt, conversion, closed down sales of goods. When the operator is faced with these special circumstances may exit the market, the law allows to sell below the cost price.

The above is the "price war" in the possible dumping behavior, there are many price wars in fact, "price war" in the name to attract consumers. Consumers think that in the price war operators will reduce prices, the operator is to seize the consumer's psychological cheat consumers to deal with their own, but the commodity prices do not fall or even may increase prices. This behavior is also regulated by law. The 14th article of China's price law provides for the prohibition of price fraud, of which fourth stipulates: "The use of false or misleading price means to lure consumers or other operators to trade with them". With regard to what is known as the misleading price method, rule seventh of the prohibition of price fraud provides in detail:

1, fictitious original price, fictitious price reduction reason, false preferential discount, factually reduce price or will raise price, lure others to buy;

2, purchase, sale of goods and provide services before there is a price commitment, non-performance or incomplete performance;

3, lied about the acquisition, sales price is higher or lower than other operators of the acquisition, sales prices, to entice consumers or operators to trade with them;

4, the adoption of doping, adulteration, to pretend true, shoddy, shortage of means such as quantity or quality and price discrepancy;

5, for the implementation of market-adjusted prices of goods and services, falsely lied for the government pricing or government guided prices;

6. Other means of price fraud.

This time, many consumers have been duped by the electric business we have to look at the price fraud listed above, such as: whether there is a price commitment, non-performance or incomplete performance (the so-called price of low 10%, 5% is reflected, whether the implementation of the commitment)? Do you pretend that the selling price is lower than the sales price of other operators, and that it is the act of tricking consumers into trading (whether there is no price reduction at all or there is no comparability between commodities)?

In addition, the use of the original price and prices in the war to promote the price of comparison to attract consumers is often used by operators. Electric Dealer "price war", there are electric dealers in the commodity price column to specify the original price is how much, the current rate is how many concessions. So, is the original price can be labeled arbitrarily? The law also has relevant provisions. Fourth of the circular of the National Development and Reform Commission on the interpretation of the provisions of the < prohibiting price fraud > Related provisions: "The original price" means the lowest transaction price of a transaction note which is transacted at the trading place within 7th before the reduction of the price; The price of the last transaction before this price. It seems that the "original price" is not a random target, this time, the electric dealer "prices war" in the electricity dealers are legally labeled the "Original price"? If the "original price" is not legally labeled, it is also suspected of price fraud.

In conclusion, this paper analyzes the legal issues involved in the "price war" of the electric trader, which is caused by the price war, but not just the "price war" of the electric dealer. In the popular "price war" today, many enterprises, whether commodity production enterprises or commodity circulation enterprises are likely to fall into the "price war", especially the home appliances industry, IT industry. "Price war" itself is not necessarily illegal, most of the case is a normal means of market competition, but also to comply with the provisions of the law, understand the law of the bottom line, within the scope of the legal provisions of war, or may throwing.