**Clear! Four types of behavior fall under price gouging by operators in the coal industry

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On April 30, the **Development and Reform Commission issued a notice outlining the price-gouging practices by operators in the coal sector. Coal is an important primary product that has a significant impact on the country’s economy and people’s livelihoods; stabilizing coal prices is crucial for keeping electricity prices stable and supporting economic stability. Last autumn and winter, coal prices rose sharply, affecting the supply of energy and increasing the costs of economic operations. Price gouging is considered one of the key reasons for the irrational rise in coal prices this time. The announcement specifies the four specific forms of price gouging in the coal sector, namely manufacturers fabricating price increase information, spreading such information, hoarding goods, and raising prices significantly or in a disguised manner without valid reasons, as well as the comprehensive factors to be taken into account. I. Fabricating price increase information. Fabricating information about a shortage of coal supplies in the region or a surge in market demand ； Fabricating information suggesting that other operators have already or are about to raise coal prices ； Fictitious coal purchase cost information ； Other fabricated information that might drive up expectations for coal prices. II. Spreading information about price increases. Spreading fabricated information about rising coal prices ； Spreading information to urge or induce other operators to raise coal prices ； Other information that could drive up expectations for coal prices. III. Hoarding for profit. After producing or purchasing coal, stockpiling it in amounts or over periods that significantly exceed normal levels without proper justification. IV. Increasing prices significantly or in a disguised manner without justifiable reasons. Raising coal prices significantly for external sales, or selling at a price that greatly exceeds the usual increase in normal years, without a corresponding significant rise in the production costs or purchase costs of coal ； By reselling to related parties, who then sell the coal at significantly higher prices ； Forcing or inducing customers to entrust them with purchasing expensive coal on the pretext of a tight coal supply ； In the process of selling coal, artificially raising coal prices significantly by unjustly increasing transportation costs or imposing other unreasonable fees ； While selling coal for medium- and long-term contracts, it indirectly raised coal prices significantly by forcing the sale of spot coal at high prices. To determine what constitutes a “significant increase in prices” in price gouging, it is necessary to establish relatively quantitative criteria for companies to follow. The Announcement states that in the presence of one of the following circumstances, without any legitimate reason, it can generally be considered as price gouging: when the seller’s prices for medium- to long-term coal transactions exceed ** or the upper limit of the reasonable range for such prices as specified in relevant local regulations ； The selling price of coal in spot transactions by operators exceeds **, or is 50% above the upper limit of the reasonable range for medium- to long-term transaction prices specified in relevant local regulations. To promote a reasonable return of coal prices, in February this year, the **Development and Reform Commission issued the \"Notice on Further Improving the Mechanism for Determining Coal Market Prices,\" which set reasonable ranges for the medium- to long-term transaction prices of coal (domestic thermal coal). The reasonable price range for coal shipped from Qinhuangdao Port (5500 kcal) is 570–770 yuan per ton. For coal from Shanxi, Shaanxi, and western Mongolia (5500 kcal), the reasonable price ranges at the mine exit are 370–570 yuan per ton, 320–520 yuan per ton, and 260–460 yuan per ton respectively. The reasonable price range for coal from eastern Mongolia (3500 kcal) at the mine exit is 200–300 yuan per ton. Effective from May 1.