China probe into Trip.com zeroes in on algorithms, prices after vendor backlash: analysts

Chinese regulators are targeting one of the world’s biggest travel platforms in an anti-monopoly probe after complaints it had hurt travellers and travel operators in China’s expansive tourism market, analysts said.

Unlike the broad legal actions against Chinese tech firms and cram schools five years ago, the investigation into Trip.com is seen as a relatively isolated case – yet one that might precipitate others – in response to issues over commissions, exclusivity and the sophisticated use of pricing algorithms.

“If a platform is no longer just matching buyers and sellers but effectively deciding how an industry functions, regulatory logic shifts from correcting behaviour to preventing market governance from being ‘privatised’,” said Alberto Vettoretti, managing partner of business consultancy Dezan Shira & Associates.

“Current actions are largely driven by compliance and evidence, targeting specific companies and practices rather than signalling a wholesale crackdown on platform businesses.”

On January 14, the State Administration for Market Regulation (SAMR) said Trip.com – operator of its own booking platform as well as Skyscanner, Ctrip, Qunar and Travix – abused its “dominant market position” and engaged in “monopolistic practices”.

Trip.com was founded in China as Ctrip in 1999 before acquiring other companies and rebranding under its current name in 2019.

South China Morning Post