China’s E-Commerce Law Faces Its First Major Overhaul Since 2019 Draft amendments expand regulation to livestreaming, social commerce and gig workers while raising the stakes for platforms
On July 4, 2026, China’s State Administration for Market Regulation and the Ministry of Commerce jointly released a draft amendment to the E-Commerce Law for public comment. The consultation period runs until August 4. This is the first systematic revision of the law since it took effect in 2019, and the changes are substantial. source
The original 2019 law was written for a simpler era of online retail. It focused mainly on traditional e-commerce platforms and the merchants selling on them. Seven years later, the market looks very different. Livestream shopping has become a dominant sales channel. Social commerce on platforms like Douyin and WeChat mini-programs drives huge transaction volumes. Millions of delivery riders, livestream hosts and other “new employment form” workers form the backbone of the system. The draft tries to catch up with that reality.
Expanding the Scope of Regulation
One of the most important shifts is the broader definition of who falls under the law. The draft explicitly brings livestreaming e-commerce, social commerce and “order generation” services into the regulatory net. This last category is particularly significant. It means platforms that control key steps in a transaction — even if they do not host a full online storefront — can still be treated as platform operators and held to corresponding responsibilities.
The draft also formally recognizes gig workers as participants in the e-commerce ecosystem. For the first time, delivery riders, livestream hosts and similar workers are given a clearer place in the legal framework. Platforms are required to safeguard their rights and interests. Workers are also given a role in market governance, reflecting a broader policy push to move beyond pure “platform versus merchant” thinking toward a multi-stakeholder model.
Stronger Platform Responsibilities and Higher Penalties
The draft strengthens the obligations platforms already carry and adds new enforcement tools. Regulators will gain more flexible options beyond the previous fixed fines and orders to suspend operations. These include the ability to suspend user registration, pause certain business activities, or cut off network access in serious cases.
The financial penalties rise significantly. Fixed fines can now reach 5 million yuan, up from the previous 2 million yuan ceiling. For particularly serious violations that cause severe social impact or especially serious consequences, regulators can impose fines of up to 5 percent of the platform’s previous year’s revenue. That turnover-based penalty is a major escalation and aligns more closely with the scale of today’s leading platforms.
These changes send a clear signal: the era of treating large platforms with relatively light fixed fines is ending. The law is moving toward a more proportionate and deterrent system.
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Addressing Everyday Pain Points
The draft also tightens rules around practices that have drawn public complaints for years. Misleading promotions, improper use of subsidies, failure to properly verify merchant qualifications, and other issues that affect consumer trust are targeted for clearer regulation. The goal is to curb the most visible forms of “involution-style” competition that regulators have repeatedly criticized.
At the same time, the draft improves coordination among government departments. It emphasizes consistent management of online and offline activities and calls for better central-local cooperation. This reflects the reality that many platform companies now operate across retail, logistics, payments and content, making single-agency oversight increasingly difficult.
The International Dimension
Perhaps the most geopolitically notable part of the draft is the addition of countermeasures against foreign restrictions. If another country or region takes discriminatory measures against Chinese e-commerce activities that violate international law or basic norms of international relations, China may respond with corresponding countermeasures.
This provision is widely seen as a response to tariffs, customs changes and regulatory actions that Chinese platforms such as Temu and Shein have faced in overseas markets. The draft also encourages greater alignment with international rules and standards in areas such as electronic signatures, payments and logistics, while supporting orderly overseas expansion by Chinese companies.
In short, the law is becoming both more protective of domestic market order and more assertive in defending Chinese firms abroad.
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What It Means in Practice
For the big platforms — Alibaba, JD.com, Pinduoduo, Douyin, Meituan and others — the draft raises the cost of non-compliance and expands the range of activities that carry legal duties. Companies that have built businesses around livestreaming and social commerce will need to reassess how they manage content, merchant oversight and worker protections.
For merchants and livestream hosts, clearer rules could bring both more protection and more compliance obligations. For delivery riders and other gig workers, the formal recognition of their role is a step toward better labor safeguards, though the details of how those rights will be enforced remain to be fleshed out in implementing regulations.
Consumers stand to gain from tighter rules against deceptive practices, though the ultimate impact will depend on how vigorously the new provisions are enforced.
Then
The public comment period closes on August 4, 2026. After reviewing feedback, the authorities are expected to refine the draft and push for formal enactment. The final version will shape how China’s e-commerce sector operates for years to come.
The 2019 law helped establish basic order in a fast-growing industry. The 2026 draft aims to modernize that framework for an era of livestream commerce, social platforms, AI-assisted shopping and intense global competition. Whether it succeeds will depend not only on the final text, but on the consistency and proportionality of enforcement that follows.
For now, the message is clear: China’s e-commerce rules are being rewritten to match the scale and complexity the industry has already reached.
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