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Thursday Jan 07 2021

Chinese web companies misusing data, 'bullying' customers, says consumer association

People walk in front of a screen at the World Internet Conference (WIC) in Wuzhen, Zhejiang province, China, October 20, 2019. REUTERS/Aly Song/File Photo
  • China Consumer Association (CAA) says Chinese web firms are violating consumers' rights by "bullying" them with purchases, promotions 
  • Beijing has already ramped up scrutiny of tech giants
  • CAA says some products and services promoted by automated systems violated the law, public order, and good customs

BEIJING/SHANGHAI: Chinese web firms have been reportedly violating the rights of consumers by misusing personal data and “bullying” people into purchasing things, the China Consumer Association (CAA), stated on Thursday.

The CAA, which is a government-backed organisation, did not name any companies but the statement came after Beijing ramped up scrutiny of technology giants, reversing a once laissez-faire approach towards its vast internet space.

“Consumers are being squeezed by data algorithms and becoming the targets of technical bullying,” the association said in the statement.

Companies must stop using systems to scan through consumers’ personal data and offer them different prices for goods based on that information, the association said.

Algorithms that checked people’s internet use and other data, then sent them targeted ads and promotions, deprived customers of choice, it added.

Some of the products and services promoted by these automated systems “violated the law and public order and good customs” it said, without going into further detail.

Consumers’ “values and moral concepts may even be distorted by algorithms and become ‘playthings’ in the hands of platform operators,” the CCA’s statement said.

Beijing issued draft rules in December aimed at preventing monopolistic behaviour by internet companies, marking China’s first serious regulatory move against the sector.

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China also warned its internet giants to brace for increased scrutiny, as it slapped fines and announced investigations into deals involving Alibaba Group and Tencent Holdings.

Chinese state media have become increasingly vocal about the infringement of consumer rights by tech companies.

In September, the state broadcaster published the results of a poll which showed that 75% of respondents believed they had been treated unfairly when they made purchases online.