China Calls for Reasonable Merchant Fees From eCommerce Platforms

China’s eCommerce regulator has issued draft guidelines for fees that companies can charge third-party merchants.

The State Administration for Market Regulation on Sunday (May 25) said that online platforms should charge reasonable fees while taking into consideration factors like operating costs for the merchants with whom they do business.

The regulator calls on platforms to set flexible pricing strategies for charges such as commission, membership, and service fees to ease the pressure on merchants, while also providing better support to smaller businesses. Companies have until June 3 to provide feedback on the draft guidance.

A report on the new guidance by Bloomberg News said the rules were in response to merchant complaints about issues such as “complicated and non-transparent” charges on the platforms. 

The report also noted that this is the latest in a series of measures from the Chinese government to assist smaller local businesses amid a slowing economy and a trade war with the U.S. following President Donald Trump’s tariffs.

As PYMNTS wrote last month, those pressures are being felt by small and medium-sized businesses (SMBs) in the U.S. as well, with nearly 20% of these businesses saying they are pessimistic about their odds of survival over the next five years.

“For SMBs, tariffs aren’t just a line item; they’re an existential threat,” that report said. “Prices for goods and services climbed to their steepest rate in over a year this month, with tariffs fueling an especially sharp increase in prices of manufactured goods. SMBs account for around one-third of total imports to the United States.”

Bigger companies can diversify suppliers or negotiate bulk contracts, advantages most SMBs don’t enjoy, PYMNTS added.

According to the Federal Reserve Bank of Atlanta, SMBs are less likely than their larger counterparts to pass higher costs onto customers, placing them at greater risk of margin pressures when inflation or supply shocks hit. This dynamic spotlights the role that new financing and payment solutions could play in helping SMBs weather economic headwinds.

Priority CEO Tom Priore told PYMNTS recently that no matter the economic environment, SMBs are constantly wrestling with complexities, and that bundled financial services can help them accelerate cash flow and optimize working capital.

“From the SMB standpoint, the exposure to tariffs at the supply chain level may actually be pretty small … but the main concern and the damage to small businesses lies with consumer uncertainty,” Priore said.

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