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Luckin fined after regulator investigation

By Wang Zhuoqiong | chinadaily.com.cn | Updated: 2020-09-22 14:45
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A beverage from Luckin Coffee is seen in Hangzhou, East China's Zhejiang province, April 3, 2020. [Photo/Sipa]

The State Administration for Market Regulation, the top market regulator, said on Tuesday it has fined 45 companies, including coffee chain Luckin Coffee, 61 million yuan ($8.99 million) for actions associated with Luckin's falsification of financial deals and misleading of the public.

The administration's investigation, ongoing since this April, showed between April and December last year Luckin has falsely inflated key figures including revenue, costs and profit rates, through artificial support from third-party companies, according to a statement from the administration.

Between August of 2019 and April this year, Luckin has widely publicized its false marketing data, deceived and misled the public, violating the country's Anti-Unfair Competition Law, according to the statement.

The investigation has found a group of 43 third-party companies, including Chextx and Beijing Shenzhou Youtong Technology Development Co Ltd, have offered substantial support to Luckin's falsifications, also violating the law.

Luckin Coffee said in reply to the fine it respected the decision and will pay the fine. It will conduct overall rectification and further regulate its marketing and operational activities and ensure a steady operation according to laws and regulations.

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