"The Six Gentlemen of Online Commerce" Apply for a Hearing on the New Regulations for Online Stores, Citing Four Reasons

by longyi on 2008-08-31 13:54:27

August 28 news: Yesterday, six online business representatives submitted a "hearing application" to the Chaoyang Branch of the Beijing Administration for Industry and Commerce (AIC), requesting a hearing regarding the regulation that requires all e-commerce operators to obtain a business license. However, this hearing application was not accepted.

In the application, the online business representatives stated, "Requiring all e-commerce operators to obtain a business license is difficult to implement and severely damages the interests of online store sellers, causing thousands of people to leave the e-commerce industry, ultimately hindering the development of the e-commerce industry and creating new social problems."

Additionally, the application detailed four reasons for requesting a hearing on the "new online store regulations": First, there are obstacles in obtaining business licenses for online merchants; second, the costs of obtaining a business license and subsequent fees are unbearable; third, implementing these regulations will lead to more social issues; fourth, mandatory business licenses may not effectively address online fraud.

The Chaoyang AIC branch stated that they do not have the authority to formulate these regulations and therefore cannot accept the hearing application. They suggested submitting the application to relevant local legislative bodies such as the Beijing Municipal Government or the Standing Committee of the Beijing Municipal People's Congress.

Below is the full text of the application:

Hearing Application

Applicants: XXX

Address: XXX

Request:

To request the Beijing Administration for Industry and Commerce to hold a hearing on the requirement in your opinion "On Implementing the 'Beijing Information Promotion Regulations' and Strengthening the Supervision and Management of E-Commerce" that all e-commerce operators must obtain a business license.

Facts and Reasons:

Your regulations require all e-commerce operators to obtain a business license, which is difficult to implement and severely harms the interests of online store sellers. This will cause thousands of people to leave the e-commerce industry, ultimately hindering the development of the e-commerce industry and creating new social problems.

1. There are obstacles in obtaining business licenses for online merchants.

Your regulations have been implemented, but we have yet to see any specific details about how online merchants can obtain business licenses. If we follow the traditional registration process, a fixed business location is the primary condition. For most of us online merchants, whether we are part-time workers, college students, or laid-off employees starting businesses through the internet, it is impossible to provide proof of a fixed business location. College students live in dormitories, and many part-time sellers are migrants who do not own property, making it impossible to provide proof of a fixed business location. This undoubtedly blocks our path to obtaining business licenses.

2. The costs of obtaining a business license and subsequent fees are unbearable.

We operate small businesses on Taobao, with monthly profits of only a few hundred yuan, just enough to sustain our living. According to relevant policies, if we obtain a business license, as individual entrepreneurs, our current fixed tax amount is 120 yuan, and commercial electricity costs 2 yuan per kilowatt-hour, etc. These costs make it impossible for us to continue operating our Taobao stores, leading to the abandonment of e-commerce by thousands of people. This regulation will not promote the development of the e-commerce industry but instead hinder its growth.

3. The implementation of this regulation will create more social problems.

Most large-scale operators on Taobao already have physical stores and have obtained business licenses. Obtaining a business license truly troubles us small sellers. Once the regulation by the Beijing AIC is implemented, thousands of sellers will leave the e-commerce industry. Many of us chose e-commerce due to a lack of funds to afford traditional shop rents. If your regulation is enforced, many will lose their jobs again, becoming idle personnel, increasing employment pressure and other social problems. Relevant estimates suggest that this regulation will create over 4 million additional job demands.

4. Mandatory business licenses may not effectively solve the occurrence of online fraud.

Your regulation aims to verify the real identities of e-commerce operators to prevent online fraud by issuing business licenses. However, the actual effect may not be as effective as the relatively sound credit evaluation system and consumer rights protection plans operated by platforms like Taobao and Paipai over the years. We deeply understand the issue of consumer rights protection in the development of e-commerce. Although there are a few unscrupulous sellers, they are only a minority, and overall consumer satisfaction remains high, reflected in the annual growth rate of the online retail market exceeding 100%. Your verification of the identity information of online merchants does not provide relief methods to help consumers protect their rights, leaving them at a loss when their rights are infringed upon.

In conclusion, your regulation requiring all e-commerce operators to compulsorily obtain business licenses will not prevent online fraud, protect consumer rights, or promote the development of e-commerce. Instead, it will directly harm the interests of us small sellers, forcing us to abandon e-commerce and causing the e-commerce industry to regress. We specially apply for a hearing to safeguard the applicant's rights from greater damage. We hope for approval as requested.

Sincerely,

Applicant: XXX

August 5, 2008

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