1. Introduction

Cross-platform exclusivity clauses are contractual or platform-imposed arrangements under which a merchant, supplier, content provider, developer, service provider, or other trading partner is required or strongly induced to deal exclusively with one platform and not with competing platforms.

Typical examples include:

• an e-commerce seller being prohibited from selling on competing marketplaces;
• a restaurant being required to use only one food-delivery platform;
• a musician or copyright owner granting exclusive rights to one streaming platform;
• a software developer being prohibited from distributing an application through competing app stores;
• a seller being denied promotional benefits if it lists products on rival platforms;
• a platform imposing technical, contractual, financial, or algorithmic penalties for multi-homing.

In China, these arrangements are particularly important because of the platform economy, where network effects, data advantages, switching costs and user concentration can make exclusivity significantly more difficult for rivals to overcome.

The central Chinese competition-law concern is generally whether the exclusivity excludes or restricts competition, particularly where it is imposed by a dominant platform.

2. Meaning of Cross-Platform Exclusivity

A clause may take several forms.

A. Express contractual exclusivity

The agreement expressly states:

“The merchant shall not sell, distribute or promote its products through any competing platform.”

This is the clearest form.

B. “Choose-one-from-two” arrangements

Chinese enforcement practice frequently refers to this as “二选一” (choose one from two).

A platform may require a merchant to choose its platform rather than competing platforms.

The restriction may be expressed formally or imposed through commercial pressure.

C. De facto exclusivity

There may be no express exclusivity clause, but the platform uses:

• higher commissions;
• reduced search visibility;
• removal from promotional campaigns;
• reduced traffic;
• technical restrictions;
• loss of subsidies;
• deposits;
• account restrictions;
• algorithmic penalties;

when a merchant also uses another platform.

The economic effect may therefore be equivalent to contractual exclusivity.

D. Conditional exclusivity

The platform does not formally prohibit multi-homing but provides benefits only if the merchant remains exclusive.

For example:

“Preferred sellers must not list products on competing platforms.”

The legality depends on the market circumstances and the competitive effects.

3. Relevant Chinese Legal Framework

A. Anti-Monopoly Law

The principal provision historically used against platform exclusivity was Article 17(4) of the pre-2022 Anti-Monopoly Law.

It prohibited a dominant undertaking, without justifiable reasons, from:

requiring trading counterparts to deal exclusively with itself or with undertakings designated by it.

The provision was particularly important in the Alibaba and Meituan cases.

The 2022 amended Anti-Monopoly Law retains the basic prohibition against abusive exclusive dealing while strengthening the treatment of the digital economy and other forms of exclusionary conduct.

B. Platform Economy Guidelines

China's Anti-Monopoly Guidelines for the Platform Economy specifically identify “choose-one-from-two” practices as a potentially problematic form of exclusive dealing.

Relevant factors include:

• whether the platform has a dominant position;
• the degree of dependence of merchants;
• duration of the restriction;
• market coverage;
• network effects;
• switching costs;
• data advantages;
• technical capabilities;
• penalties for multi-homing;
• effects on competitors and consumers.

The existence of exclusivity does not automatically establish an infringement in every commercial relationship. The competitive context remains important.

4. Why Cross-Platform Exclusivity Can Be Anti-Competitive

A. Foreclosure of rival platforms

Suppose Platform A has 70% of relevant transactions and requires major merchants to sell exclusively through A.

Platform B may technically remain available, but if important merchants disappear from B, consumers may also leave B.

This creates a feedback loop:

Merchant exclusivity → fewer products → fewer consumers → lower platform attractiveness → fewer merchants → weaker competitor

This is particularly significant in two-sided markets.

B. Network effects

Platforms frequently benefit from:

More sellers → more consumers → more sellers

An exclusivity arrangement can interrupt this process for competitors.

A dominant platform can therefore use its existing network to make entry or expansion more difficult.

C. Raising rivals' costs

A competing platform may need to spend substantially more on:

• merchant acquisition;
• subsidies;
• advertising;
• logistics;
• technology;
• consumer incentives.

The rival's costs rise because it cannot obtain access to merchants on normal commercial terms.

D. Reduction of multi-homing

Multi-homing occurs when merchants or users participate in several competing platforms.

Multi-homing generally makes competition easier because merchants can switch or participate simultaneously.

Exclusivity can transform:

multi-homing → single-homing

and thereby increase platform dependence.

5. Six Important Chinese Cases

1. SAMR v. Alibaba — 2021

This is the leading Chinese enforcement case concerning cross-platform exclusivity.

The State Administration for Market Regulation (SAMR) found that Alibaba had abused its dominant position in China's online retail platform service market.

Since 2015, Alibaba had implemented a “choose-one-from-two” policy requiring merchants to choose Alibaba's platform rather than competing platforms.

The conduct included:

• prohibiting merchants from opening stores on competing platforms;
• restricting participation in competing-platform promotions;
• monitoring merchants;
• reducing search visibility;
• restricting promotional opportunities;
• imposing other rewards and punishments.

SAMR concluded that the conduct restricted competition and constituted abusive exclusive dealing.

Alibaba was fined approximately RMB 18.228 billion, equivalent to 4% of its 2019 domestic sales.

Legal significance

The case demonstrates that exclusivity can be established through a combination of contractual, commercial and algorithmic mechanisms, rather than a single written clause.

2. SAMR v. Meituan — 2021

Meituan provides another major example.

SAMR found that Meituan had required restaurants to enter exclusive cooperation arrangements in China's online food-delivery platform market.

The mechanisms included:

• differential commission rates;
• delaying merchant onboarding;
• exclusive cooperation agreements;
• exclusive cooperation deposits;
• algorithmic and data-based monitoring;
• penalties for dealing with competing platforms.

SAMR determined that these practices restricted competition and constituted abuse of a dominant position.

Meituan was fined approximately RMB 3.442 billion, representing 3% of its 2020 domestic sales, and was required to return approximately RMB 1.289 billion in exclusive-cooperation deposits.

Legal significance

The case demonstrates that a platform cannot necessarily avoid antitrust scrutiny merely by characterising exclusivity as a “voluntary commercial agreement.”

Where commercial pressure effectively prevents merchants from using competing platforms, regulators may examine the substance and economic effect of the arrangement.

3. Sherpa's — Shanghai, 2021

Sherpa's, an English-language food-delivery platform in Shanghai, was investigated for exclusivity arrangements with restaurants.

The arrangements reportedly required restaurants to cooperate exclusively with Sherpa's and prevented them from working with competing delivery platforms.

Shanghai's market-regulation authority imposed a fine of approximately RMB 1.2 million.

The case is significant because it demonstrated that “choose-one-from-two” enforcement was not restricted to China's largest national platforms.

Legal significance

The case illustrates the possibility of enforcement against exclusivity where a platform's conduct can foreclose competitors in a defined local or specialised platform market.

4. Tencent Music / China Music Group — 2021

This case involved the online music platform market and exclusive copyright.

Tencent's acquisition of China Music Group resulted in the combined entity controlling a very large collection of exclusive music-copyright resources.

SAMR found that the transaction could strengthen Tencent's ability to obtain further exclusive copyright agreements and create barriers to competitors.

SAMR therefore required Tencent to:

• terminate relevant exclusive music-copyright arrangements;
• stop certain high-prepayment practices;
• avoid obtaining preferential terms from copyright owners without justification.

Legal significance

This case extends the exclusivity analysis beyond ordinary merchant contracts.

Exclusive content rights can themselves become an important competitive bottleneck when the rights are essential or highly significant for competing platforms.

It therefore demonstrates that cross-platform exclusivity may arise through IP licensing arrangements, not merely ordinary distribution contracts.

5. Rainbow v. Johnson & Johnson — Shanghai Higher People's Court, 2013

In Beijing Ruibang Yonghe Science and Technology Trade Co. v. Johnson & Johnson Medical (Shanghai)/Johnson & Johnson Medical (China), the dispute concerned vertical contractual restrictions in medical-product distribution.

The case principally concerned resale-price maintenance, rather than digital-platform exclusivity.

Rainbow alleged that J&J had imposed contractual restrictions and subsequently punished the distributor.

The Shanghai Higher People's Court ultimately reversed the first-instance decision and awarded damages to Rainbow.

Relevance to cross-platform exclusivity

Although it is not a pure exclusivity case, it is important for understanding China's treatment of vertical contractual restrictions.

It demonstrates that courts can examine:

• contractual restrictions;
• enforcement mechanisms;
• distributor dependence;
• competitive effects; and
• the relationship between contractual sanctions and competition.

Thus, where a cross-platform exclusivity clause is combined with contractual penalties, the entire contractual mechanism may need to be examined rather than the exclusivity wording alone.

6. Yangtze River Pharmaceutical / HIPI Pharma — Supreme People's Court

This litigation concerned allegations of exclusive dealing in the pharmaceutical sector.

The plaintiff alleged that a long-term supply agreement required it to purchase an active pharmaceutical ingredient exclusively from the defendant for five years.

The Supreme People's Court considered the exclusive arrangement together with the defendant's intellectual-property rights and the competitive conditions.

The Court did not simply treat the existence of exclusivity as automatically unlawful; it examined the competitive significance of the restriction and legitimate IP-related justifications.

Legal significance

This case is important for a fundamental principle:

Exclusivity is not inherently unlawful merely because the contract contains an exclusive purchasing obligation.

The relevant inquiry includes the purpose, market position, duration, market coverage, foreclosure effect and legitimate business justification.

6. Additional Judicial Illustration — Meituan and Ele.me Litigation

Chinese courts have also dealt with private disputes involving alleged platform exclusivity.

For example, courts in Zhejiang and Jiangsu considered disputes concerning allegations that Meituan required merchants to list exclusively on its platform or close their competing-platform outlets.

Reported decisions included proceedings involving Ele.me and Meituan in Jinhua and Huai'an.

These disputes are useful because they show that platform exclusivity can generate not only administrative antitrust proceedings, but also private litigation and unfair-competition disputes.

7. Distinguishing Legitimate Exclusivity from Anti-Competitive Exclusivity

Not every exclusivity clause is prohibited.

A manufacturer may legitimately appoint an exclusive distributor where exclusivity is necessary to:

• protect confidential information;
• encourage relationship-specific investment;
• prevent free-riding;
• establish a new distribution network;
• protect intellectual property;
• ensure quality control;
• justify substantial investment.

For example, a new technology company might give one distributor territorial exclusivity for a limited period because the distributor must invest heavily in warehouses, training and after-sales infrastructure.

The competition-law concern becomes stronger where:

1. the supplier/platform has substantial market power;
2. the restriction covers a large proportion of the market;
3. the duration is long;
4. switching is difficult;
5. competing platforms require access to the same merchants;
6. important merchants are locked into exclusivity;
7. penalties are imposed for multi-homing;
8. network effects reinforce the foreclosure;
9. the restriction raises rivals' costs; and
10. there is no convincing legitimate justification.

8. Carrot-and-Stick Exclusivity

One of the most important lessons from Chinese platform enforcement is that exclusivity can operate through both carrots and sticks.

Carrots

• preferential search rankings;
• lower commissions;
• advertising credits;
• subsidies;
• promotional placement;
• preferred merchant status.

Sticks

• higher commissions;
• reduced traffic;
• search down-ranking;
• removal from promotions;
• deposits;
• account restrictions;
• technical blocking;
• delayed onboarding.

Thus:

Formal contract + incentives + penalties + algorithms = effective exclusivity

Chinese enforcement has increasingly looked at the combined economic mechanism rather than merely asking whether a document contains the word “exclusive.”

9. Cross-Platform Exclusivity and Algorithmic Enforcement

Digital platforms make exclusivity substantially easier to enforce.

A platform may use:

• transaction data;
• API information;
• merchant identifiers;
• pricing information;
• web crawling;
• account matching;
• algorithmic ranking;
• automated penalty systems.

For example:

Merchant joins Platform B

↓

Platform A detects the activity

↓

Merchant's Platform A ranking falls

↓

Traffic decreases

↓

Merchant loses sales

↓

Merchant returns to exclusive dealing

This can constitute de facto exclusivity even if the written contract does not expressly prohibit multi-homing.

The Alibaba and Meituan matters are particularly important examples of the relevance of data and algorithmic mechanisms to exclusivity enforcement.

10. Relevant Market Definition

Before assessing exclusivity, Chinese competition analysis generally requires identification of the relevant product/service and geographic markets.

For digital platforms, possible markets include:

• online retail platform services;
• online food-delivery platform services;
• online music-platform services;
• online travel platforms;
• app distribution;
• digital advertising;
• payment platforms;
• logistics platforms.

The Alibaba case illustrates the importance of market definition: SAMR considered Alibaba's position in China's online retail platform service market and examined market share, concentration, network effects, merchant dependence, switching costs and other factors.

11. Factors for Assessing an Exclusivity Clause

12. Exclusive Dealing vs. Ordinary Commercial Exclusivity

Ordinary exclusivity

“Distributor A has exclusive rights to distribute the product in Province X for two years.”

This does not automatically constitute an antitrust violation.

Potentially problematic platform exclusivity

“Merchant must not sell on any competing platform anywhere in China and will lose promotional privileges if it does.”

The second arrangement presents substantially greater competition concerns where the platform possesses significant market power.

13. Exclusive Content and Platform Competition

Cross-platform exclusivity is particularly important for:

Music

Exclusive music catalogues can make rival streaming platforms less attractive.

Video

Exclusive films, television programmes and sports rights can create content bottlenecks.

Gaming

Exclusive distribution or platform access can prevent competing ecosystems from obtaining important games.

E-commerce

Exclusive merchant arrangements can deprive rival marketplaces of important brands and products.

Food delivery

Exclusive restaurants can reduce the usefulness of competing delivery platforms.

Digital payments

Merchant acceptance restrictions can prevent competing payment systems from obtaining sufficient transaction volume.

14. Defences and Justifications

A business should not assume that every exclusivity arrangement is automatically prohibited.

Potential justifications can include:

1. Protection of specific investment

The distributor invests substantial resources specifically for the supplier.

2. Prevention of free-riding

Exclusivity may prevent one distributor from benefiting from another distributor's investment.

3. Quality control

A platform may need exclusive arrangements for technically complex or sensitive services.

4. IP protection

Exclusive licensing can sometimes protect intellectual property.

5. Data security

Certain arrangements may be necessary to protect sensitive information.

6. Limited duration

Shorter exclusivity may produce less foreclosure than indefinite exclusivity.

7. Limited market coverage

An arrangement covering a small proportion of the market may create substantially weaker exclusionary effects.

The Chinese Platform Economy Guidelines recognise that certain restrictions may have legitimate justifications, including protection of IP rights, trade secrets, data security, specific investments and reasonable business models.

15. Compliance Risks for Platform Businesses

A platform adopting exclusivity arrangements should examine:

Contract drafting

Avoid unnecessarily broad clauses such as:

“Merchant shall not cooperate with any competing platform.”

Incentive systems

Review whether preferential treatment is conditional on exclusivity.

Algorithms

Check whether ranking or recommendation systems automatically punish merchants using competitors.

Commercial teams

Sales personnel should not threaten merchants with:

• delisting;
• loss of traffic;
• increased commissions;
• withdrawal of subsidies;

because of multi-homing without a legitimate basis.

Data systems

Ensure that competitor activity is not systematically monitored merely to impose exclusionary penalties.

Duration

Use limited and commercially justified periods where exclusivity is genuinely necessary.

16. Key Principles Emerging from the Cases

The Chinese cases collectively demonstrate several important principles:

1. Exclusivity is assessed in its competitive context.
2. Dominant-platform exclusivity creates significantly greater antitrust risk.
3. “Choose-one-from-two” is a central Chinese platform-antitrust concern.
4. A written exclusive clause is not necessary for de facto exclusivity.
5. Algorithmic penalties can reinforce contractual exclusivity.
6. Deposits and financial penalties can make nominally voluntary arrangements coercive.
7. Exclusive copyright can create platform foreclosure where content is an important competitive input.
8. Network effects can magnify otherwise limited contractual restrictions.
9. Legitimate investment and IP justifications remain relevant.
10. Private litigation can supplement administrative enforcement.

17. Case-Law Summary

18. Conclusion

Cross-platform exclusivity clauses occupy a high-risk area of Chinese competition law when imposed by powerful platforms. The Alibaba and Meituan decisions demonstrate that China can treat “choose-one-from-two” arrangements as abusive exclusive dealing where a dominant platform uses contractual restrictions, incentives, penalties, data or algorithms to prevent merchants from dealing with rivals.

At the same time, Chinese law does not make every exclusive distribution, licensing or supply agreement automatically unlawful. The analysis depends on market power, market coverage, duration, foreclosure, network effects, switching costs, multi-homing, competitive effects and legitimate commercial justification.

For examination purposes, the central proposition can be stated as:

A cross-platform exclusivity clause becomes particularly problematic under Chinese competition law when a platform with substantial market power uses contractual or technological mechanisms to prevent trading partners from multi-homing, thereby foreclosing competing platforms without sufficient legitimate justification.