Shanghai Authorities Crack Down on Unfair Competition Practices

On February 5, 2026, the Shanghai Municipal Administration for Market Regulation released ten typical cases of unfair competition, aiming to urge market entities to comply with laws and foster a fair competitive environment.

Overview of Cases

The cases involve various illegal activities, including:

• False Promotion: Several companies engaged in misleading advertising practices. For instance, a real estate developer added unplanned features to show flats for promotional purposes, and a biotechnology firm fabricated therapeutic claims targeting elderly consumers.
• Commercial Confusion: Businesses were found creating confusion among consumers by imitating the branding and packaging of established competitors.
• Fake Transactions: Some companies inflated sales figures and customer engagement metrics through fabricated transactions to mislead consumers and investors.
• Commercial Bribery: Instances of bribery to gain unfair market advantages were identified and penalized.
• Infringement of Trade Secrets: Unauthorized use and disclosure of competitors' trade secrets were among the violations addressed.

Regulatory Actions

The Shanghai authorities have intensified enforcement of the newly revised Anti-Unfair Competition Law, conducting special actions in key sectors such as online transactions, healthcare, e-commerce, and trade secret protection. In 2025, over 690 cases were investigated and penalized, reflecting a robust stance against unfair competition.

Implications for Businesses

These actions serve as a clear warning to market entities about the consequences of engaging in unfair competition. Companies operating in Shanghai and broader China should ensure compliance with competition laws to avoid legal repercussions and contribute to a fair market environment.