Beijing Targets Use of China’s Sharing Economy Platforms for Illegal Fund-raising

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Beijing has launched a new directive that targets fraud involving the use of sharing economy platforms.

The National Development and Reform Commission (NDRC) recently issued the “Notice Concerning the Effective Performance of Work in Relation to Guiding and Standardising the Healthy Development of the Sharing Economy” (关于做好引导和规范共享经济健康良性发展有关工作的通知) in conjunction with China’s Central Cyberspace Affairs Commission and the Ministry of Industry and Information Technology.

The directive calls for “strictly striking against illegal fund-raising, the theft of user private information, harm to national security and other forms of illegal, criminal activity that promotes under the commercial guise of ‘developing the sharing economy.'”

According to the directive regulators will push for increases to protections on personal information and prevention of information disclosure, damage or loss, as well as make use of the public credit system to deal with illicit behaviour by sharing economy platforms.

Regulators are called upon to promptly gather and publicise any information concerning the illicit conduct of sharing economy platforms via the “Credit China” website, including lack of permits or licenses, false publicity or deposit complaints, as well as publicise credit information including the administrative permits and penalties obtained or incurred by enterprises via the state enterprise credit information sharing system.

Beijing made reference to the sharing economy as a “new growth point” at the 19th National Chinese Communist Party Conference in October 2017, while earlier this year the Central Economic Work Conference and the 2018 “Government Work Report” make requirements with regard to the development of the country’s sharing economy.

The NDRC indicated that the Chinese government will seek to effectively deal with new situations and problems that have arisen in relation to the recent growth of the sharing economy, as well as drive the healthy development of the sharing economy.

 

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