China Imposes 1 Trillion Won Administrative Penalty on Ctrip for Violating Anti-Monopoly Law

Confiscation of Illicit Gains and Imposition of Fines

Chinese authorities have imposed an administrative penalty totaling about 1 trillion won on Ctrip, China's largest online travel platform, for violating anti-monopoly laws.

Trip.com. Yonhap News Agency

According to China's state-run Xinhua News Agency on July 25, the State Administration for Market Regulation announced that it had confirmed Ctrip's abuse of its market dominance and decided to impose administrative sanctions.

The authorities confiscated Ctrip's illegal gains amounting to 1.658 billion yuan (approximately 350 billion won) and imposed an additional fine of 3.521 billion yuan (around 760 billion won). The total amount of sanctions comes to 5.179 billion yuan (about 1.1 trillion won).

The authorities also ordered Ctrip to immediately cease its illegal activities, refund the entire 122 million yuan (about 26.3 billion won) in reserve funds it had forcibly collected from hotel operators, and publicly announce a comprehensive corrective plan.

Ctrip is an online platform operated by Trip.com Group, China's largest online travel services provider, which also owns Trip.com, Qunar, and Skyscanner. The company offers reservations for flights, hotels, and travel packages.

Since last year, authorities received multiple reports that Ctrip was forcing hotel businesses to sign unfair contracts and using technical means to control hotel prices. A formal investigation began in January this year.

As a result of the investigation, authorities determined that Ctrip had leveraged its dominant market position to virtually force exclusive transactions on hotel businesses and demand the "lowest internet prices." They concluded that these practices restricted industry operations, infringed on price-setting rights, and undermined both consumer interests and fair market competition.

Sujian Zhong, Deputy Director of the National Anti-Monopoly and Anti-Unfair Competition Committee's Expert Advisory Group, told Xinhua News Agency, "This investigation is intended to strengthen ongoing anti-monopoly supervision for the healthy development of the platform economy. All platform businesses should take this opportunity to abandon 'low-price competition' and 'exclusive competition' practices and establish a fair market order."

Last year, China revised its Anti-Unfair Competition Law to strengthen regulation, introducing new clauses targeting practices such as forcing sellers to price below cost and the abuse of market dominance by major companies.

In April, authorities also imposed a total fine and forfeiture of illegal gains of 3.597 billion yuan (about 780.2 billion won) on seven major platform companies that violated the Food Safety Law and the E-Commerce Law by, for example, allowing "ghost kitchens" to operate on their platforms.

This content was produced with the assistance of AI translation services.