China’s on-demand delivery providers to tighten merchant inspection, as regulator finds 35,000 illegal restaurants on their platforms

Chinese on-demand delivery services operators, including Meituan Dianping and Alibaba Group Holding-owned Ele.me, are tightening inspection of restaurants on their online platforms, after a government regulator found up to 35,000 such establishments were operating illegally.

The Beijing Market Supervision Administration, which has initiated more than 2,100 cases against those illegal food merchants, announced on Wednesday that it has met with these platform operators to “ensure the safety of online-ordered food”. It did not identify the offending merchants.

Many of the restaurants listed with the online delivery platforms operators either did not have a licence or carried a fake licence, according to the regulator. It said the platforms failed to set up a strict inspection system to review the quality of food vendors they do business with.

The country’s major food delivery platform players were on board with the regulator’s direction, according to separate statements they made on Wednesday.

“We will use our Sky Net system to strengthen our inspection mechanism,” said Lu Weijia, chief food security officer at Meituan Dianping. In addition, Lu said the company plans to set up food safety insurance for its users.

Sky Net, which provides a digital archive of all the merchants on Meituan Dianping’s platforms, is also being integrated by the company with local regulatory databases to help speed up its merchant verification and inspection processes.