A mainland China court has just ordered online travel agency Trip.com to review and amend its privacy policy after it was found guilty of engaging in price discrimination. The ruling is expected to open the company to further legal action and possibly force it to change its policies for all users.
The Keqiao District People's Court in Shaoxing ruled in favor of the plaintiff who accused the company of price discrimination. The court ordered the Hong Kong-listed company to either allow the plaintiff to use its services without agreeing to its privacy policy or to permanently stop collecting unnecessary personal information.
The plaintiff surnamed Hu said the company charged her 2,889 yuan for a hotel room, which should have only cost 1,377 yuan. The court ordered the company to pay the plaintiff 4,777 yuan as compensation for false advertising, deception and fraud.
China has been gradually increasing its legal framework to restrict technology companies from excessively collecting personal data from their users. The country is expected to soon launch a new law called the Personal Information Protection Law - the country's first law aimed at safeguarding user's personal data. The PIPL is currently in draft form and is still undergoing review.
Under the proposed law, companies will only be allowed to collect the minimum amount of data needed for their services. It will also bar the use of data to set prices for customers - a practice known as price discrimination.
In Trip.com's case, the court in Keqiao found that the company had collected personal information from the plaintiff such as her calendar, data from other apps and location to set the price for her hotel room. According to the ruling, published by China's judicial news service online, Trip.com required users to agree to its privacy policy before they could use the service. The application then created a user profile that tracked the user's behavior within the app.
"Many commercial apps require users to generally agree to their service agreement and privacy policy before users download and use them. Some of these terms are unnecessary and harm the interest of users, but in order to use the app, users can only choose to give their consent," the ruling said.
