China’s market regulator has ordered seven e-commerce platforms to pay a combined fine of about 3.6 billion yuan, or $527.3 million, over food delivery safety breaches tied to ghost delivery. The companies were also told to suspend new cake shop listings for between three and nine months.
The State Administration for Market Regulation said the platforms failed to properly verify merchants’ food licences and professional qualifications before allowing them to operate on their services. The action covers ByteDance-owned Douyin, Ele.me, Meituan, Tmall.com and Alibaba’s Taobao Shangou, among others, and follows a broader push by Beijing to tighten oversight of online food delivery.
The regulator said the seven companies must rectify the illegal practices. Their legal representatives and food safety directors will separately pay a total of 19.69 million yuan in penalties. Ghost delivery is the term for food delivery services provided by businesses that falsify credentials or operate without the required food licences, a practice that can put consumers at risk while masking weak controls inside fast-growing platforms.
The fines land while China’s on-demand food and grocery sector has become increasingly fierce over the past year. Alibaba and JD.com have been chasing extra customers with coupons and discounts on items such as ice cream and takeaway coffee, adding to the pressure. That competition in instant retail has squeezed margins and weighed on profitability, turning delivery growth into a costly race rather than an easy win.
Last month, the SAMR tightened oversight of online food delivery to boost transparency, and this enforcement action shows that the campaign is moving from warning to punishment. Pinduoduo said it sincerely accepts the ruling and will resolutely comply, adding that it will take the decision as a lesson and further standardise its business processes. The question now is not whether China’s regulator will keep pushing; it is how far platform operators will have to go to prove every merchant they host is real, licensed and safe.
The message from Beijing is plain. In a market where growth has been chased with discounts and speed, compliance is now part of the delivery model, and companies that cannot show it are likely to pay for it again.