China Issues Opinions on Accelerating the Innovative Development of the Retail Industry
Published 10 July 2026
Sarah Xuan
In July 2026, the MOFCOM, together with eight other departments, including the NDRC, the Ministry of Justice, the Ministry of Finance, and the SAMR, issued the Opinions on Accelerating the Innovative Development of the Retail Industry (the “Opinions”). The Opinions make systematic arrangements for the innovative transformation and high-quality development of the retail industry, with the objective of basically forming, by 2030, a modern retail system featuring a rational layout, quality supply, diverse business formats, smart and convenient services, and orderly competition.
For foreign-invested enterprises operating in China, the Opinions are not merely an industry promotion policy. Their content covers multiple areas, including commercial outlet planning, product quality, after-sales services, platform governance, price regulation, algorithmic transparency, supply chain management, and labor and employment, and will have a continuing impact on foreign-invested retail enterprises, consumer goods brand owners, cross-border trading enterprises, platform operators, commercial real estate operators, and supply chain service providers. Foreign-invested enterprises need to identify regulatory trends from industry policies and translate them into compliance review checklists and directions for business model adjustment in their China operations.
I. Policy Background: Transformation of the Retail Industry and Changes in the Operating Environment for Foreign-Invested Consumer Enterprises in China The retail industry is an important link connecting production, distribution, and consumption, and it is also an important entry point for foreign-invested enterprises to participate in China’s consumer market. In recent years, the scale of China’s retail market has continued to expand, online and offline integration has accelerated, and new business formats such as community commerce, instant retail, warehouse membership stores, the first-store economy, culture-and-tourism commerce, cross-border consumption, and digital retail have continued to develop. At the same time, the industry also faces issues such as uneven distribution of commercial outlets, insufficient supply of quality goods and services, homogeneous competition, disputes over platform fees, disorderly price promotions, and inconsistent rules for online and offline competition.
The promulgation of the Opinions reflects a comprehensive change in the policy orientation of Chinese regulators toward the retail industry. On the one hand, the government seeks to stimulate consumption vitality through scenario innovation, integration of business formats, digital transformation, supply chain upgrading, and financing support; on the other hand, it will also regulate industry order through tools such as fair competition, price governance, platform regulation, tax compliance, and consumer protection. For foreign-invested enterprises, this means that compliance management for retail operations in China cannot remain limited to traditional matters such as store operating permits, product imports, labeling, and consumer complaint handling; it must also cover broader areas such as platform cooperation, algorithmic recommendations, channel pricing, supply chain finance, data use, labor and employment, and cross-regional operations.
II. Commercial Layout and Store Expansion: Foreign-Invested Retail Enterprises Need to Pay Attention to Local Planning, Urban Renewal, and Saturation of Commercial Facilities The Opinions first emphasize systematic planning for new layouts, requiring the formulation of national standards for commercial outlet planning and related matters, and promoting the alignment of urban and rural commercial outlet construction with territorial spatial planning and urban renewal plans. The document also proposes implementing an action to improve the quality of urban commerce, promoting the renovation and upgrading of pedestrian streets, commercial districts, 15-minute convenient living circles, county-level commerce, and the “thousand markets and ten thousand stores” initiative, and encouraging the establishment of an assessment mechanism for the saturation of commercial facilities.
This arrangement has a direct impact on store site selection, commercial district layout, and investment decisions of foreign-invested retail enterprises. In the past, when foreign-invested brands expanded in the Chinese market, they usually focused on consumption capacity, foot traffic, rent, transportation, and city tier. After the implementation of the Opinions, local commercial outlet planning, urban renewal projects, community commerce policies, and assessment results regarding the saturation of commercial facilities may gradually become important factors in determining the feasibility of site selection and the stability of leases.
For foreign-invested enterprises planning to open large stores, warehouse membership stores, flagship stores in shopping centers, outlet projects, brand experience stores, or community retail outlets, pre-investment due diligence should focus on whether the project complies with local commercial outlet planning and territorial spatial planning, and whether it involves matters such as renovation of old commercial facilities, consolidation of property rights, fire-safety renovation, compatibility of land use, or mixed building functions. For commercial real estate operators and shopping center managers, attention should also be paid to whether projects may in the future be included within the scope of commercial facility operation monitoring or saturation assessment, and compliance risks relating to business format adjustment, tenant mix, and renovation should be assessed in advance.
III. Product Quality and Consumer Protection: Supply Chain Entry Management Will Become a Compliance Priority The Opinions require retail business entities to strengthen procurement quality control and traceability, carefully select suppliers, encourage the development of private labels and quality self-commitment systems, and propose cracking down on the manufacture and sale of counterfeit and substandard goods both online and offline. The document also requires promoting the inclusion by platform operators and counter lessors of indicators such as sampling inspection pass rates and return rates of resident operators into assessment mechanisms.
This part has important implications for both foreign-invested consumer goods enterprises and retail enterprises. Foreign-invested brands usually have relatively mature global supply chains and quality management systems, but when selling in the Chinese market, they must still ensure that product quality, Chinese-language labels, certification requirements, import procedures, advertising and promotional claims, after-sales services, and recall mechanisms comply with Chinese legal requirements. For foreign-invested brands sold through distributors, franchisees, platform stores, multi-brand stores, counters, or third-party operators, the brand owner should also strengthen authorization management over channel operators and review the source of goods, so as to prevent counterfeiting, parallel sales, unauthorized sales, or non-compliant advertising from damaging brand reputation and triggering regulatory risks.
For private-label products, co-branded products, customized products, and imported products, foreign-invested retail enterprises should focus on reviewing supplier admission, quality clauses in procurement contracts, product inspection reports, product barcodes, traceability information, labels and markings, return and exchange rules, and consumer complaint handling procedures. In platform sales scenarios, they should also pay attention to the platform’s assessment mechanisms for indicators such as sampling inspection pass rates, return rates, complaint rates, and negative review rates, and assess whether the relevant indicators may affect store traffic, eligibility for promotional activities, deposits, penalties, or renewal of cooperation.
IV. After-Sales Services and Returns and Exchanges: Rules for Physical Retail and Online Retail Are Converging The Opinions emphasize improving service quality and encourage retail business entities to provide services such as product customization, home delivery, tare-free weighing, synchronized delivery and installation, shopping assistance for the elderly, and mother-and-baby rooms; to continue deepening returns and exchanges across different locations and different stores; to implement online seven-day no-reason returns in accordance with the law; and to encourage physical retail business entities to commit to no-reason returns. At the same time, the document proposes rectifying arbitrary charges in after-sales installation and maintenance services.
This part indicates that China’s retail regulation will further strengthen its focus on after-sales services and consumer experience. Foreign-invested enterprises should in particular note that consumer protection rules in the Chinese market have a strong administrative regulatory character, and consumer complaints may quickly turn into market regulation actions, handling by consumer associations, platform penalties, or public opinion risks. In sectors such as household appliances, electronic products, furniture, maternal and infant products, sports equipment, cosmetics, apparel, food, and ordinary consumer goods related to health care, standards for after-sales installation, maintenance, returns and exchanges, gifts, membership rights and interests, and service charges should be clear, transparent, and enforceable.
Foreign-invested enterprises should review whether return and exchange policies are consistent among online flagship stores, offline stores, distributor stores, franchise stores, and after-sales service outlets, whether returns and exchanges across different locations and different stores are operationally feasible, and whether service commitments exceed the enterprise’s actual performance capacity. For physical retail enterprises, although the Opinions currently only encourage commitments to no-reason returns, if an enterprise voluntarily makes such a commitment, it should ensure that store employees, customer service systems, cashier systems, inventory management, and financial refund processes can support the implementation of the commitment, so as to avoid false advertising or consumer rights disputes arising from failure to honor the commitment.
V. Scenario Innovation and Integration of Business Formats: Compliance Review Should Be Embedded Simultaneously in New Business Models The Opinions support creating new retail scenarios through “one store, one policy,” promoting the renewal and renovation of old blocks, spatial restructuring of commercial facilities, renewal of business formats, and digital-intelligent transformation, encouraging the integrated development of retail with catering, culture, entertainment, sports, tourism, and other sectors, and supporting first stores, first launches, first shows, and distinctive themed shopping scenarios.
For foreign-invested brands, this provides policy space for flagship stores, experience stores, pop-up stores, the first-store economy, brand exhibitions, member activities, cultural collaborations, sports marketing, and culture-and-tourism consumption scenarios. However, scenario innovation usually involves multiple compliance issues. For example, brand pop-up activities may involve temporary structures, fire safety, outdoor advertising, filing for mass activities, music or audiovisual copyrights, performance permits, food business operations, prize-draw promotions, and collection of personal information; brand exhibitions and immersive experiences may involve consumer safety, protection of minors, portrait rights, data collection, and content review; and cross-sector co-branded products may involve trademark licensing, copyright licensing, advertising compliance, and allocation of product liability.
Therefore, when designing new retail scenarios, foreign-invested enterprises should front-load legal compliance review, rather than conducting a formality-based confirmation shortly before the activity goes live. A relatively prudent approach is to establish a standardized compliance checklist for new retail projects, covering matters such as venues, advertising, promotions, intellectual property, consumer rights and interests, personal information, fire safety, contractual authorizations, third-party suppliers, and emergency plans. For cross-city touring exhibitions, nationwide launch events, or large-scale member activities, attention should also be paid to possible differences in approval and filing practices across regions.
VI. Digitalization, Artificial Intelligence, and Digital RMB: Technology Applications Give Rise to New Data and Algorithm Compliance Requirements The Opinions propose supporting the digital transformation of retail business entities, connecting online and offline channels, products, services, and data, encouraging platforms to provide technological empowerment to small and medium-sized retail business entities, promoting “AI+”, and expanding scenarios such as intelligent shopping guides, low-altitude delivery, and unmanned vending. The document also proposes promoting the use of digital RMB in the issuance and settlement of consumption vouchers, and relying on digital RMB smart contracts to achieve efficient turnover and precise direct delivery of subsidy funds.
Foreign-invested retail enterprises generally attach importance to membership management, precision marketing, inventory forecasting, store foot traffic analysis, online-offline integration, and automated customer service. The Opinions encourage digital-intelligent transformation, but enterprises must still comply with China’s rules on personal information protection, data security, cybersecurity, algorithmic recommendations, and protection of consumer rights and interests when applying relevant technologies. In particular, in scenarios such as member profiling, intelligent shopping guides, personalized recommendations, automatic issuance of coupons, facial recognition, store foot traffic monitoring, unmanned retail, low-altitude delivery, and third-party data cooperation, enterprises need to review the purposes of personal information processing, notice-and-consent mechanisms, the principle of minimum necessity, data storage, and cross-border transfer arrangements.
For multinational groups, special attention should also be paid to the data flow relationship between retail data in China and overseas headquarters, global CRM systems, overseas cloud service providers, and cross-border data analytics platforms. If personal information or important data is transferred overseas, an assessment should be made in accordance with Chinese legal requirements as to whether procedures such as the standard contract for outbound transfer of personal information, personal information protection certification, a data export security assessment, or other compliance procedures are triggered. For enterprises that use algorithmic recommendations, automated pricing, intelligent ranking, or personalized promotions, they should also ensure that recommendation logic, price display, and users’ right of choice comply with requirements of transparency, fairness, and non-discrimination.
VII. Supply Chains and Financing: Foreign-Invested Enterprises Should Pay Attention to Barcode Standards, Warehousing and Distribution Systems, and Supply Chain Finance Compliance The Opinions encourage retail business entities to integrate supply chain resources, develop new models such as unified warehousing and distribution, centralized procurement and distribution, and joint delivery, support financial institutions in improving the quality and efficiency of financing services for inventories, warehouse receipts, and accounts receivable, and promote GS1 product barcodes, QR codes, and standard pallets, thereby advancing “one code to the end” and “one pallet (or box) to the end.”
This has dual significance for foreign-invested consumer goods enterprises and retail enterprises. First, supply chain standardization will help improve the efficiency of product traceability, inventory management, warehousing and distribution, cross-regional allocation, and quality recalls. Foreign-invested enterprises should review whether their global barcode systems, product codes, pallet standards, warehouse labels, and China local systems can be smoothly connected. For enterprises that sell imported goods, cross-border e-commerce goods, and locally produced goods in parallel, it is particularly necessary to avoid confusion in product codes, batch management, label versions, and channel inventories.
Second, supply chain finance support will enable inventory, warehouse receipt, and accounts receivable financing to play a greater role in the retail industry. If foreign-invested enterprises participate in supply chain finance, factoring, warehouse receipt pledges, asset securitization, or commercial real estate investment trusts, they should pay attention to issues such as the authenticity of underlying transactions, ownership of goods, warehouse supervision, confirmation of accounts receivable, information disclosure, related-party transactions, and foreign exchange administration. For intra-group procurement, onshore and offshore settlements, and related-party funding arrangements of multinational groups, the implications for tax, customs, transfer pricing, and foreign exchange compliance should also be assessed simultaneously.
VIII. Labor and Flexible Employment: Retail Innovation Must Not Overlook Employment Compliance The Opinions encourage retail business entities to stabilize their workforce, make greater use of labor-contract-based employment, improve employee benefits, absorb persons facing employment difficulties, strengthen the protection of rights and interests of flexible employees and workers in new forms of employment, and accelerate approval procedures for positions that meet the requirements for implementation of special working hour systems.
Foreign-invested retail enterprises in the Chinese market usually involve a large number of store employees, shopping guides, promoters, warehousing personnel, delivery personnel, customer service personnel, part-time personnel, and outsourced service personnel. As models such as instant retail, home delivery, livestream sales, in-store pickup, unmanned retail, and community group buying develop, employment relationships may become more complex. Enterprises should review labor contracts, service outsourcing, labor dispatch, part-time employment, platform cooperation, and third-party service provider management models, so as to avoid risks of determination of employment relationships, social insurance, overtime pay, work-related injury liability, or joint and several liability arising from excessive actual management and control.
For positions that require the application of a comprehensive working hour system or a flexible working hour system, foreign-invested enterprises should complete approvals for special working hour systems in accordance with local requirements, and retain records regarding the nature of the position, working time arrangements, and employee confirmations. For workers in new forms of employment, such as delivery personnel, crowdsourced service personnel, or platform collaboration personnel, even if the enterprise does not directly establish an employment relationship, it should still pay attention to whether the cooperating party performs basic obligations to protect labor rights and interests, so as to avoid employment disputes in the supply chain and platform ecosystem being transmitted to the brand owner.
IX. Platform Cooperation and Fair Competition: Foreign-Invested Brands Need to Re-examine Platform Rules, Traffic, and Pricing Mechanisms The Opinions expressly propose implementing the Anti-Unfair Competition Law of the People’s Republic of China and treating online and offline retail equally; promoting reasonable charges by platform operators and reducing the costs of operators on platforms; strengthening antitrust review of concentrations of undertakings in the platform sector; promoting the lawful opening by platform operators of necessary algorithm data to regulatory authorities, so as to promote fairness and transparency in algorithmic recommendations and traffic allocation; and promoting the establishment by platforms of diversified algorithmic recommendation indicator systems, under which product price must not be used as the sole core parameter for algorithmic recommendations.
This part has an important impact on the operation of foreign-invested brands in China’s platform channels. Many foreign-invested consumer brands are highly dependent on e-commerce platforms, instant retail platforms, content platforms, and livestreaming platforms to obtain traffic. Platform commissions, technical service fees, advertising bidding, activity registration fees, traffic allocation, algorithmic ranking, low-price subsidies, and platform major-promotion rules directly affect brand profit margins and channel pricing systems. The Opinions indicate that the fairness, transparency, and reasonableness of platform rules will become a regulatory focus.
Foreign-invested brands should re-examine cooperation agreements, annual framework agreements, promotion agreements, advertising placement agreements, and data service agreements with platforms, and pay attention to whether platforms engage in conduct such as compelling participation in promotions, indirectly requiring brands to bear subsidies, shifting promotional costs, restricting operations through other channels, imposing unreasonable charges, or using algorithms to affect transaction opportunities. At the same time, brand owners themselves should also avoid participating in unfair competition through vertical price restraints, exclusivity arrangements, false promotions, fake orders and credit manipulation, false reviews, or improper traffic manipulation.
Comment The Opinions on Accelerating the Innovative Development of the Retail Industry provide a systematic policy framework for the innovative transformation of China’s retail industry over the next several years. For foreign-invested enterprises, their impact will run through multiple links, including market entry, store layout, platform operations, product quality, price promotions, consumer protection, digital applications, supply chain management, labor and employment, and regulatory response. Foreign-invested enterprises should not only seize the commercial opportunities arising from the upgrading of physical retail, scenario innovation, supply chain optimization, financing of consumption infrastructure, and cross-channel integration, but also promptly adjust their internal compliance systems to ensure that their China operations can adapt to the new requirements for fair competition, platform governance, price regulation, data compliance, and consumer protection.
For foreign-invested enterprises operating in China, the Opinions are not merely an industry promotion policy. Their content covers multiple areas, including commercial outlet planning, product quality, after-sales services, platform governance, price regulation, algorithmic transparency, supply chain management, and labor and employment, and will have a continuing impact on foreign-invested retail enterprises, consumer goods brand owners, cross-border trading enterprises, platform operators, commercial real estate operators, and supply chain service providers. Foreign-invested enterprises need to identify regulatory trends from industry policies and translate them into compliance review checklists and directions for business model adjustment in their China operations.
I. Policy Background: Transformation of the Retail Industry and Changes in the Operating Environment for Foreign-Invested Consumer Enterprises in China The retail industry is an important link connecting production, distribution, and consumption, and it is also an important entry point for foreign-invested enterprises to participate in China’s consumer market. In recent years, the scale of China’s retail market has continued to expand, online and offline integration has accelerated, and new business formats such as community commerce, instant retail, warehouse membership stores, the first-store economy, culture-and-tourism commerce, cross-border consumption, and digital retail have continued to develop. At the same time, the industry also faces issues such as uneven distribution of commercial outlets, insufficient supply of quality goods and services, homogeneous competition, disputes over platform fees, disorderly price promotions, and inconsistent rules for online and offline competition.
The promulgation of the Opinions reflects a comprehensive change in the policy orientation of Chinese regulators toward the retail industry. On the one hand, the government seeks to stimulate consumption vitality through scenario innovation, integration of business formats, digital transformation, supply chain upgrading, and financing support; on the other hand, it will also regulate industry order through tools such as fair competition, price governance, platform regulation, tax compliance, and consumer protection. For foreign-invested enterprises, this means that compliance management for retail operations in China cannot remain limited to traditional matters such as store operating permits, product imports, labeling, and consumer complaint handling; it must also cover broader areas such as platform cooperation, algorithmic recommendations, channel pricing, supply chain finance, data use, labor and employment, and cross-regional operations.
II. Commercial Layout and Store Expansion: Foreign-Invested Retail Enterprises Need to Pay Attention to Local Planning, Urban Renewal, and Saturation of Commercial Facilities The Opinions first emphasize systematic planning for new layouts, requiring the formulation of national standards for commercial outlet planning and related matters, and promoting the alignment of urban and rural commercial outlet construction with territorial spatial planning and urban renewal plans. The document also proposes implementing an action to improve the quality of urban commerce, promoting the renovation and upgrading of pedestrian streets, commercial districts, 15-minute convenient living circles, county-level commerce, and the “thousand markets and ten thousand stores” initiative, and encouraging the establishment of an assessment mechanism for the saturation of commercial facilities.
This arrangement has a direct impact on store site selection, commercial district layout, and investment decisions of foreign-invested retail enterprises. In the past, when foreign-invested brands expanded in the Chinese market, they usually focused on consumption capacity, foot traffic, rent, transportation, and city tier. After the implementation of the Opinions, local commercial outlet planning, urban renewal projects, community commerce policies, and assessment results regarding the saturation of commercial facilities may gradually become important factors in determining the feasibility of site selection and the stability of leases.
For foreign-invested enterprises planning to open large stores, warehouse membership stores, flagship stores in shopping centers, outlet projects, brand experience stores, or community retail outlets, pre-investment due diligence should focus on whether the project complies with local commercial outlet planning and territorial spatial planning, and whether it involves matters such as renovation of old commercial facilities, consolidation of property rights, fire-safety renovation, compatibility of land use, or mixed building functions. For commercial real estate operators and shopping center managers, attention should also be paid to whether projects may in the future be included within the scope of commercial facility operation monitoring or saturation assessment, and compliance risks relating to business format adjustment, tenant mix, and renovation should be assessed in advance.
III. Product Quality and Consumer Protection: Supply Chain Entry Management Will Become a Compliance Priority The Opinions require retail business entities to strengthen procurement quality control and traceability, carefully select suppliers, encourage the development of private labels and quality self-commitment systems, and propose cracking down on the manufacture and sale of counterfeit and substandard goods both online and offline. The document also requires promoting the inclusion by platform operators and counter lessors of indicators such as sampling inspection pass rates and return rates of resident operators into assessment mechanisms.
This part has important implications for both foreign-invested consumer goods enterprises and retail enterprises. Foreign-invested brands usually have relatively mature global supply chains and quality management systems, but when selling in the Chinese market, they must still ensure that product quality, Chinese-language labels, certification requirements, import procedures, advertising and promotional claims, after-sales services, and recall mechanisms comply with Chinese legal requirements. For foreign-invested brands sold through distributors, franchisees, platform stores, multi-brand stores, counters, or third-party operators, the brand owner should also strengthen authorization management over channel operators and review the source of goods, so as to prevent counterfeiting, parallel sales, unauthorized sales, or non-compliant advertising from damaging brand reputation and triggering regulatory risks.
For private-label products, co-branded products, customized products, and imported products, foreign-invested retail enterprises should focus on reviewing supplier admission, quality clauses in procurement contracts, product inspection reports, product barcodes, traceability information, labels and markings, return and exchange rules, and consumer complaint handling procedures. In platform sales scenarios, they should also pay attention to the platform’s assessment mechanisms for indicators such as sampling inspection pass rates, return rates, complaint rates, and negative review rates, and assess whether the relevant indicators may affect store traffic, eligibility for promotional activities, deposits, penalties, or renewal of cooperation.
IV. After-Sales Services and Returns and Exchanges: Rules for Physical Retail and Online Retail Are Converging The Opinions emphasize improving service quality and encourage retail business entities to provide services such as product customization, home delivery, tare-free weighing, synchronized delivery and installation, shopping assistance for the elderly, and mother-and-baby rooms; to continue deepening returns and exchanges across different locations and different stores; to implement online seven-day no-reason returns in accordance with the law; and to encourage physical retail business entities to commit to no-reason returns. At the same time, the document proposes rectifying arbitrary charges in after-sales installation and maintenance services.
This part indicates that China’s retail regulation will further strengthen its focus on after-sales services and consumer experience. Foreign-invested enterprises should in particular note that consumer protection rules in the Chinese market have a strong administrative regulatory character, and consumer complaints may quickly turn into market regulation actions, handling by consumer associations, platform penalties, or public opinion risks. In sectors such as household appliances, electronic products, furniture, maternal and infant products, sports equipment, cosmetics, apparel, food, and ordinary consumer goods related to health care, standards for after-sales installation, maintenance, returns and exchanges, gifts, membership rights and interests, and service charges should be clear, transparent, and enforceable.
Foreign-invested enterprises should review whether return and exchange policies are consistent among online flagship stores, offline stores, distributor stores, franchise stores, and after-sales service outlets, whether returns and exchanges across different locations and different stores are operationally feasible, and whether service commitments exceed the enterprise’s actual performance capacity. For physical retail enterprises, although the Opinions currently only encourage commitments to no-reason returns, if an enterprise voluntarily makes such a commitment, it should ensure that store employees, customer service systems, cashier systems, inventory management, and financial refund processes can support the implementation of the commitment, so as to avoid false advertising or consumer rights disputes arising from failure to honor the commitment.
V. Scenario Innovation and Integration of Business Formats: Compliance Review Should Be Embedded Simultaneously in New Business Models The Opinions support creating new retail scenarios through “one store, one policy,” promoting the renewal and renovation of old blocks, spatial restructuring of commercial facilities, renewal of business formats, and digital-intelligent transformation, encouraging the integrated development of retail with catering, culture, entertainment, sports, tourism, and other sectors, and supporting first stores, first launches, first shows, and distinctive themed shopping scenarios.
For foreign-invested brands, this provides policy space for flagship stores, experience stores, pop-up stores, the first-store economy, brand exhibitions, member activities, cultural collaborations, sports marketing, and culture-and-tourism consumption scenarios. However, scenario innovation usually involves multiple compliance issues. For example, brand pop-up activities may involve temporary structures, fire safety, outdoor advertising, filing for mass activities, music or audiovisual copyrights, performance permits, food business operations, prize-draw promotions, and collection of personal information; brand exhibitions and immersive experiences may involve consumer safety, protection of minors, portrait rights, data collection, and content review; and cross-sector co-branded products may involve trademark licensing, copyright licensing, advertising compliance, and allocation of product liability.
Therefore, when designing new retail scenarios, foreign-invested enterprises should front-load legal compliance review, rather than conducting a formality-based confirmation shortly before the activity goes live. A relatively prudent approach is to establish a standardized compliance checklist for new retail projects, covering matters such as venues, advertising, promotions, intellectual property, consumer rights and interests, personal information, fire safety, contractual authorizations, third-party suppliers, and emergency plans. For cross-city touring exhibitions, nationwide launch events, or large-scale member activities, attention should also be paid to possible differences in approval and filing practices across regions.
VI. Digitalization, Artificial Intelligence, and Digital RMB: Technology Applications Give Rise to New Data and Algorithm Compliance Requirements The Opinions propose supporting the digital transformation of retail business entities, connecting online and offline channels, products, services, and data, encouraging platforms to provide technological empowerment to small and medium-sized retail business entities, promoting “AI+”, and expanding scenarios such as intelligent shopping guides, low-altitude delivery, and unmanned vending. The document also proposes promoting the use of digital RMB in the issuance and settlement of consumption vouchers, and relying on digital RMB smart contracts to achieve efficient turnover and precise direct delivery of subsidy funds.
Foreign-invested retail enterprises generally attach importance to membership management, precision marketing, inventory forecasting, store foot traffic analysis, online-offline integration, and automated customer service. The Opinions encourage digital-intelligent transformation, but enterprises must still comply with China’s rules on personal information protection, data security, cybersecurity, algorithmic recommendations, and protection of consumer rights and interests when applying relevant technologies. In particular, in scenarios such as member profiling, intelligent shopping guides, personalized recommendations, automatic issuance of coupons, facial recognition, store foot traffic monitoring, unmanned retail, low-altitude delivery, and third-party data cooperation, enterprises need to review the purposes of personal information processing, notice-and-consent mechanisms, the principle of minimum necessity, data storage, and cross-border transfer arrangements.
For multinational groups, special attention should also be paid to the data flow relationship between retail data in China and overseas headquarters, global CRM systems, overseas cloud service providers, and cross-border data analytics platforms. If personal information or important data is transferred overseas, an assessment should be made in accordance with Chinese legal requirements as to whether procedures such as the standard contract for outbound transfer of personal information, personal information protection certification, a data export security assessment, or other compliance procedures are triggered. For enterprises that use algorithmic recommendations, automated pricing, intelligent ranking, or personalized promotions, they should also ensure that recommendation logic, price display, and users’ right of choice comply with requirements of transparency, fairness, and non-discrimination.
VII. Supply Chains and Financing: Foreign-Invested Enterprises Should Pay Attention to Barcode Standards, Warehousing and Distribution Systems, and Supply Chain Finance Compliance The Opinions encourage retail business entities to integrate supply chain resources, develop new models such as unified warehousing and distribution, centralized procurement and distribution, and joint delivery, support financial institutions in improving the quality and efficiency of financing services for inventories, warehouse receipts, and accounts receivable, and promote GS1 product barcodes, QR codes, and standard pallets, thereby advancing “one code to the end” and “one pallet (or box) to the end.”
This has dual significance for foreign-invested consumer goods enterprises and retail enterprises. First, supply chain standardization will help improve the efficiency of product traceability, inventory management, warehousing and distribution, cross-regional allocation, and quality recalls. Foreign-invested enterprises should review whether their global barcode systems, product codes, pallet standards, warehouse labels, and China local systems can be smoothly connected. For enterprises that sell imported goods, cross-border e-commerce goods, and locally produced goods in parallel, it is particularly necessary to avoid confusion in product codes, batch management, label versions, and channel inventories.
Second, supply chain finance support will enable inventory, warehouse receipt, and accounts receivable financing to play a greater role in the retail industry. If foreign-invested enterprises participate in supply chain finance, factoring, warehouse receipt pledges, asset securitization, or commercial real estate investment trusts, they should pay attention to issues such as the authenticity of underlying transactions, ownership of goods, warehouse supervision, confirmation of accounts receivable, information disclosure, related-party transactions, and foreign exchange administration. For intra-group procurement, onshore and offshore settlements, and related-party funding arrangements of multinational groups, the implications for tax, customs, transfer pricing, and foreign exchange compliance should also be assessed simultaneously.
VIII. Labor and Flexible Employment: Retail Innovation Must Not Overlook Employment Compliance The Opinions encourage retail business entities to stabilize their workforce, make greater use of labor-contract-based employment, improve employee benefits, absorb persons facing employment difficulties, strengthen the protection of rights and interests of flexible employees and workers in new forms of employment, and accelerate approval procedures for positions that meet the requirements for implementation of special working hour systems.
Foreign-invested retail enterprises in the Chinese market usually involve a large number of store employees, shopping guides, promoters, warehousing personnel, delivery personnel, customer service personnel, part-time personnel, and outsourced service personnel. As models such as instant retail, home delivery, livestream sales, in-store pickup, unmanned retail, and community group buying develop, employment relationships may become more complex. Enterprises should review labor contracts, service outsourcing, labor dispatch, part-time employment, platform cooperation, and third-party service provider management models, so as to avoid risks of determination of employment relationships, social insurance, overtime pay, work-related injury liability, or joint and several liability arising from excessive actual management and control.
For positions that require the application of a comprehensive working hour system or a flexible working hour system, foreign-invested enterprises should complete approvals for special working hour systems in accordance with local requirements, and retain records regarding the nature of the position, working time arrangements, and employee confirmations. For workers in new forms of employment, such as delivery personnel, crowdsourced service personnel, or platform collaboration personnel, even if the enterprise does not directly establish an employment relationship, it should still pay attention to whether the cooperating party performs basic obligations to protect labor rights and interests, so as to avoid employment disputes in the supply chain and platform ecosystem being transmitted to the brand owner.
IX. Platform Cooperation and Fair Competition: Foreign-Invested Brands Need to Re-examine Platform Rules, Traffic, and Pricing Mechanisms The Opinions expressly propose implementing the Anti-Unfair Competition Law of the People’s Republic of China and treating online and offline retail equally; promoting reasonable charges by platform operators and reducing the costs of operators on platforms; strengthening antitrust review of concentrations of undertakings in the platform sector; promoting the lawful opening by platform operators of necessary algorithm data to regulatory authorities, so as to promote fairness and transparency in algorithmic recommendations and traffic allocation; and promoting the establishment by platforms of diversified algorithmic recommendation indicator systems, under which product price must not be used as the sole core parameter for algorithmic recommendations.
This part has an important impact on the operation of foreign-invested brands in China’s platform channels. Many foreign-invested consumer brands are highly dependent on e-commerce platforms, instant retail platforms, content platforms, and livestreaming platforms to obtain traffic. Platform commissions, technical service fees, advertising bidding, activity registration fees, traffic allocation, algorithmic ranking, low-price subsidies, and platform major-promotion rules directly affect brand profit margins and channel pricing systems. The Opinions indicate that the fairness, transparency, and reasonableness of platform rules will become a regulatory focus.
Foreign-invested brands should re-examine cooperation agreements, annual framework agreements, promotion agreements, advertising placement agreements, and data service agreements with platforms, and pay attention to whether platforms engage in conduct such as compelling participation in promotions, indirectly requiring brands to bear subsidies, shifting promotional costs, restricting operations through other channels, imposing unreasonable charges, or using algorithms to affect transaction opportunities. At the same time, brand owners themselves should also avoid participating in unfair competition through vertical price restraints, exclusivity arrangements, false promotions, fake orders and credit manipulation, false reviews, or improper traffic manipulation.
Comment The Opinions on Accelerating the Innovative Development of the Retail Industry provide a systematic policy framework for the innovative transformation of China’s retail industry over the next several years. For foreign-invested enterprises, their impact will run through multiple links, including market entry, store layout, platform operations, product quality, price promotions, consumer protection, digital applications, supply chain management, labor and employment, and regulatory response. Foreign-invested enterprises should not only seize the commercial opportunities arising from the upgrading of physical retail, scenario innovation, supply chain optimization, financing of consumption infrastructure, and cross-channel integration, but also promptly adjust their internal compliance systems to ensure that their China operations can adapt to the new requirements for fair competition, platform governance, price regulation, data compliance, and consumer protection.