[Direct answer]In the Beijing area, merchants who engage in fake orders and reviews may face three types of legal consequences. First, civil liability: If consumers make purchasing decisions based on false reviews and suffer losses, they can claim punitive damages in accordance with Article 1182 of the Civil Code of the People's Republic of China (effective January 1, 2021); if the operator engages in fraud, they can request corresponding compensation according to law. Second, administrative liability: False transactions and reviews will disrupt market competition order and infringe consumers' right to know. Market supervision departments can impose penalties in accordance with the Anti-Unfair Competition Law of the People's Republic of China (amended in 2019) and relevant consumer protection regulations, and may order the cessation of illegal activities and the elimination of their impact. Third, criminal liability: If an operator organizes or instructs others to engage in false transactions to meet the criminal filing standards for specific transaction quantities or false review quantities, and the circumstances are serious, they may be suspected of committing the crime of false transactions or the crime of false advertising, etc. It should be noted that fake orders and reviews on e-commerce platforms may also trigger platform-level penalties, including deleting reviews, deducting points, lowering store ratings, or even removing the store; at the same time, the act of collecting commissions by fake order organizers may itself constitute an illegal act. In practice, another key point is evidence: transaction records, chat records, and communication records with fake order platforms are not only the basis for administrative punishment, but also important clues for criminal filing.Intellectual property protection and corporate lawThe column provides specific explanations on corporate compliance and risk prevention and control.

I. Problem Background and Typical Scenarios

The business owners who consult on such issues are often in the response stage after their order-faking activities have been questioned by platforms or regulators. There are three common concerns: whether order-faking is just an industry practice and will actually be punished; how to handle orders that have already been faked; and how to prevent employees or outsourced teams from triggering risks again. In practice, a key understanding is that order-faking is not simply a marketing tactic, but an act of influencing transaction decisions through false information, which therefore violates consumers' right to information and fair competition order. Another common misconception is that small amounts of money won't affect the handling of the case. In reality, regulators often focus on the organizational methods and transaction scale rather than individual amounts. Moreover, order-faking may also trigger collateral penalties from platforms, affecting store operations. Additionally, there are multiple entities in the order-faking chain: businesses, order-faking organizers, participating buyer accounts, and intermediary platforms, each with different responsibilities and handling methods. Therefore, clarifying the chain structure is a prerequisite for addressing the issue. For tracking platform rules and regulatory trends, please refer to the following sources:Business and contract disputes in enterprisesColumn; for the overall design of the compliance system, you can refer to it for reference.Special services and other casesColumn.

II. Key points of dispute

Focus One: Whether the act of placing fake orders constitutes fraud against consumers. Focus Two: The applicable conditions and calculation basis for punitive damages. Focus Three: The types and severity of penalties imposed by market supervision authorities. Focus Four: Whether the case meets the standards for criminal prosecution and the specific charges involved. Focus Five: The platform's contractual provisions and regulatory basis. Focus Six: The allocation of responsibilities among various parties in the fake order scheme. Focus Seven: Clean-up and remedial measures for existing fake orders. Focus Eight: The design of internal management and accountability systems. In addition, attention should also be paid to the flow of funds and commissions in the fake order chain, the connection between administrative and criminal procedures, and the differences between platform rules and administrative determinations. The above-mentioned specific rules shall be subject to the currently effective laws, regulations, supervisory provisions, and judicial rulings.

III. Professional analysis by Henglue Law Firm

From the perspective of compliance and risk prevention, the handling of the fake order issue should be divided into three steps. The first step is to stop losses and clarify the facts: immediately stop the ongoing fake order behavior, and seal up transaction records, chat records, commission settlement records, and relevant account information. It should be noted that deleting records not only fails to eliminate risks, but also may aggravate unfavorable consequences if it is regarded as destroying evidence. Therefore, these records should be preserved in their entirety and used for risk assessment. The second step is to investigate the impact: check the consumers involved in the fake orders, assess whether complaints, lawsuits, or platform penalties have occurred, and actively evaluate whether remedial measures are needed, such as providing refunds, compensation, or explanations for the relevant orders. The third step is to rectify the system: from the perspective of organizational management, investigate the upstream causes of the demand for fake orders, such as sales assessment pressure, misinterpretation of platform rules, or sales incentive design. By adjusting the assessment methods, increasing training, and setting compliance review nodes, the driving factors can be eliminated. It should be noted that the completeness of the rectification is an important factor affecting the subsequent handling. Generally, the earlier the rectification is initiated, the more it can demonstrate the sincerity and effectiveness of the correction. It should be reminded that merchants' voluntary stopping and cooperating with the investigation usually help mitigate the consequences, but cannot exempt them from the responsibilities that have already occurred. At the same time, they should avoid making statements in the communication process that may be regarded as admitting or shifting responsibilities. When handling such compliance issues, this firm usually promotes the three parts of stopping losses, investigating, and rectifying simultaneously, and designs external communication strategies in parallel, so as to properly handle the issue while reducing the impact on business operations.

IV. Practical suggestions and legal basis

Action recommendations: 1. Immediately stop the practice of order-fraud and fully preserve all relevant records; 2. Investigate the consumers involved in the fraudulent orders and their complaint status; 3. Assess whether remedial measures such as refunds, replacements, or compensation are necessary; 4. Investigate the organizational methods and financial flows behind the order-fraud activities; 5. Adjust internal evaluation and incentive mechanisms; 6. Provide compliance training to relevant personnel and outsourced teams; 7. Evaluate whether proactive communication with platforms and regulatory authorities is needed. Legal basis: - Articles 1182 and 577 of the Civil Code of the People's Republic of China (both effective from January 1, 2021); - The Anti-Unfair Competition Law of the People's Republic of China (amended in 2019, effective from April 23, 2019); - The Consumer Rights and Interests Protection Law of the People's Republic of China (amended in 2013, effective from March 15, 2014); - The Measures for the Supervision and Administration of Online Transactions (Decree No. 37 of the State Administration for Market Regulation, effective from May 1, 2021).

5. Henglu Law Firm's Advice

The completeness of the rectification will affect the determination of the circumstances of the follow-up handling. Sixthly, firstly, the practice of boosting sales and ratings may trigger civil, administrative, and criminal risks simultaneously. Secondly, do not delete or modify records to avoid being regarded as destroying evidence. Thirdly, the earlier the remedial measures for the boosted orders are taken, the better. Fourthly, proactive rectification is an important factor affecting the handling of the circumstances. Fifthly, pay attention to distinguishing the forms of responsibility of various entities in the chain. Sixthly, avoid making inappropriate statements during communication. Seventhly, institutionalize the rectification measures to avoid recurring problems. Eighthly, evaluate the actual impact of the platform and regulatory handling. For the overall approach to building an enterprise compliance system, you can refer to it for reference.Special services and other casesColumn.

VI. Frequently Asked Questions

Q1: What penalties will be imposed for manipulating sales data and boosting ratings?

They may face three types of penalties simultaneously: consumers can claim punitive damages for fraud; market supervision authorities can impose fines and order the cessation of illegal activities in accordance with the Anti-Unfair Competition Law and relevant regulations on consumer rights protection; if the case meets the standards for criminal prosecution, they may be held criminally liable. In addition, the platform may delete reviews, deduct points, reduce rankings, or remove stores according to contracts and rules. The actual consequences depend on the organizational structure and transaction scale.

Q2: Will I still be dealt with even if the amount involved is not large?

It's possible. Supervision and criminal identification usually focus on the degree of organization, the total volume of transactions, and whether a fund chain and a commission system have been established, rather than the individual amount. Even if the amount is small, if there is systematic organization, bulk operations, and fund settlement, it may still constitute a violation of the law and even meet the criminal standards. Therefore, it's not advisable to take the small amount as a reason for taking risks.

Q3: If the platform submits the record of fake orders, will it lead to an immediate investigation?

Not necessarily. The data submitted by the platform is usually used as clues. Whether to initiate a case still needs to be determined by the investigating authority based on comprehensive factors such as the organization mode, fund flow, and transaction scale. However, it should be noted that the platform data and the data retained by the merchant himself can often corroborate each other. Therefore, it is more beneficial to cooperate with the investigation and provide truthful explanations; deliberately evading or making false statements may lead to more adverse consequences. It is recommended to consult professional advice promptly after receiving relevant notifications.

Q4: Do you only handle complaints after they're reported on the platform?

No. Platform handling is just one of the triggering factors. Regulatory authorities can take the initiative to investigate and deal with it, and consumers can also file complaints and reports. The act of fake orders simultaneously damages consumers' right to know and the order of fair competition. It has multiple possibilities of being complained about, reported, and actively investigated. Therefore, whether it is discovered by the platform or not should not be used as a criterion for judgment.

Q5: What should I do with the orders I've already processed?

It is recommended to first fully preserve the relevant records, then evaluate the scope of consumers involved in the orders and the complaint situation, and take remedial measures such as returns, replacements, and compensation when necessary, while simultaneously adjusting the evaluation display guidelines. It should be noted that do not delete transaction and chat records on your own, as this may be regarded as destroying evidence; at the same time, avoid making statements admitting fault in customer service communications, and if necessary, handle the matter through unified guidelines and with the involvement of professional consultants.

This article is written based on the common judicial interpretations in the Beijing area. If the case occurs in other regions, it is recommended to consult local lawyers to verify the regional differences.

If you are currently facing similar problems, it is recommended that you consult a professional lawyer as soon as possible with the relevant evidence materials, to avoid missing the statutory time limit. →Intellectual property protection legal services·Beijing Henglu Law Firm

Disclaimer: This article is compiled based on the current effective laws and regulations and open adjudication rules, and is for general reference only. It does not constitute a formal legal opinion on specific cases. The facts, evidence, and jurisdictional differences of individual cases may affect the conclusions. In case of disputes, please consult a practicing lawyer in time.