Core Viewpoint - The release of the "Internet Platform Pricing Behavior Rules" marks a new phase of refined and normalized price regulation in China's platform economy, aiming to reshape the responsibilities and rights among platforms, merchants, and consumers, and promote a market focused on quality and service [1][5]. Summary by Sections Pricing Competition Order - The rules aim to standardize pricing competition, providing clear guidelines for platform operators and internal operators to foster a market order characterized by quality and fair competition [2]. - The rules protect the pricing autonomy of operators, ensuring that platform operators cannot impose unreasonable restrictions or conditions on the pricing behaviors of internal operators [2]. Consumer Rights Protection - The rules enforce clear pricing practices, promote transparency in dynamic and differential pricing, and regulate services like automatic payments to better protect consumers' rights to information and choice [2]. Detailed Regulations - The rules detail six specific norms regarding pricing competition, focusing on maintaining order, clarifying pricing integrity, and prohibiting unfair pricing practices such as predatory pricing, price discrimination, collusion, price gouging, and fraud [2]. Implementation Timeline - The implementation date for the rules is set for April 10, 2026, allowing time for platform operators to align their internal compliance systems with the new regulations [3]. - During the interim period, major platform operators will conduct self-assessments against the regulatory requirements and enhance their internal rules to comply with the new standards [3]. Industry Self-Regulation - The relevant regulatory bodies will guide industry associations to strengthen self-regulation and ensure the effective implementation of the rules [4]. Expected Positive Impacts - The rules are anticipated to purify the market competition environment, curb unfair pricing practices, and create a fair competitive space for small and medium-sized operators, thereby stimulating market innovation [5]. - They will protect consumer rights and prevent practices like data-driven price discrimination, enhancing consumer trust in a transparent pricing environment [5]. - The rules will guide the transformation of the platform industry, encouraging investment in technological innovation, service upgrades, and quality improvements, facilitating a shift from scale expansion to quality enhancement [5].

Core Insights - The article discusses the transformation in the e-commerce industry regarding advertising expenses, emphasizing that the previous model of "burning money for volume" is no longer sustainable [1][3] - New regulations from the National Market Supervision Administration clarify the definition of commercial advertising, bringing transparency to advertising costs and requiring companies to categorize their spending accordingly [1][2] Group 1: Regulatory Changes - The new regulations shift the treatment of advertising expenses from full cost deduction to limited deduction based on advertising fees, impacting companies' taxable profits if they exceed the limits [2] - Companies that previously relied on high-intensity advertising to expand rapidly, particularly in the beauty sector, face significant adjustments as their advertising costs could exceed 30% of revenue under the new rules [2][3] Group 2: Impact on Businesses - Small and medium-sized apparel businesses, which operate on thin margins, are particularly vulnerable to the new regulations, as their financial stability may be tested [2] - Companies that categorized advertising expenses as "technical service fees" will need to adjust their financial accounting and compliance strategies due to the reclassification of these costs [2][3] Group 3: Platform Adjustments - E-commerce platforms are adapting by redesigning advertising products to provide clearer cost breakdowns, helping businesses categorize expenses in compliance with the new regulations [4] - The integration of compliance checks within algorithm systems is anticipated to become standard, enhancing transparency and accountability in advertising practices [4][5] Group 4: Future Directions - The regulatory changes are part of a broader shift towards more refined governance of the digital economy, aiming to address issues like inflated advertising costs and unfair competition [6] - Companies are encouraged to transition from a focus on short-term gains to building capabilities and establishing data-driven decision-making frameworks that prioritize customer retention and cost recovery [6]

Core Viewpoint - The recent statements from EU officials highlight the deepening trade friction between the US and EU regarding digital economy governance, emphasizing the EU's commitment to its "sovereign" digital regulations [1][2]. Group 1: EU Digital Regulations - The EU's Digital Services Act and Digital Markets Act are characterized as "sovereign legislation" and will continue to be implemented, covering all digital platforms operating in the EU market [1]. - The EU's regulatory framework applies to any company providing services within the EU, regardless of its headquarters location, indicating a strong stance on jurisdiction [1][2]. - The EU has identified major tech companies like Google, Amazon, Apple, Meta, Microsoft, and ByteDance as "gatekeepers," with potential fines of up to 20% of global revenue for violations [2]. Group 2: US-EU Trade Relations - The US has expressed concerns over the EU's digital regulations, with President Trump warning of high tariffs and export restrictions on countries implementing discriminatory policies [1][2]. - The EU's digital service tax, which targets revenues from digital services, has been adopted by several European countries with rates typically set between 2% and 3% [1][2]. - The EU has indicated that the digital service tax is a separate issue from US-EU trade agreements, suggesting potential retaliatory measures if trade negotiations fail [3]. Group 3: Broader Implications - The divergence in digital governance reflects deeper economic philosophical differences, with the US favoring minimal regulation and the EU advocating for high standards of protection [2][3]. - The ongoing digital regulatory dispute may complicate the already slow progress of the US-EU trade framework agreement, which faces legislative hurdles [3]. - The struggle for digital governance authority signifies a broader reallocation of power in the global digital economy, with significant implications for international digital governance [3].