January 26, 2011 / 10:43 AM / 9 years ago

China fines Carrefour and Wal-Mart for manipulating prices

BEIJING (Reuters) - China fined French and U.S. retail giants Carrefour (CARR.PA) and Wal-Mart (WMT.N) for lying about the price of their goods, its top economic planner said on Wednesday.

The National Development and Reform Commission singled out the two retailers for either over-stating their discounts by inflating pre-discounted prices, or for charging prices higher than what was labeled or advertised.

Carrefour and Wal-Mart had engaged in such practices in various Chinese cities including Shanghai, Kunming, Shenyang, Harbin and Chongqing, the commission said on its website.

Worried about rising price pressures, the Chinese government usually conducts random checks of store prices ahead of holidays, especially when the country is fighting inflation.

China is set to celebrate the Lunar New Year holiday next week and the government is worried inflation could quicken to its fastest in over two years then as festive spending exacerbates price pressures.

The commission said Carrefour, Wal-Mart and other unnamed retailers were fined up to 500,000 yuan ($75,960).

In fining them, the commission said it wanted to “remind and warn all business operators to exercise self-discipline when pricing goods and to conduct their business in an honest manner.”

Carrefour could not be immediately reached for comment and Wal-Mart declined to comment.

China’s annual inflation dipped in December to 4.6 percent, from November’s 28-month high of 5.1 percent, although many economists think the respite would be temporary.

In early December, the commission’s office in Kunming in Yunnan province ordered Carrefour, Wal-Mart and several local supermarkets to give the city government 48 hours’ notice before adjusting prices of goods.

Reporting by Langi Chiang, Koh Gui Qing in Beijing and Melanie Lee in Shanghai; Editing by Jacqueline Wong and Lincoln Feast

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