Beijing slaps edtech unicorns Zuoyebang, Yuanfudao with steep fine over false advertising
- The State Administration for Market Regulation imposed a maximum penalty of 2.5 million yuan each on Big Tech-funded Zuoyebang and Yuanfudao
- The two companies are the front runners in China’s pre-college, off-campus education market

The notice also said that Zuoyebang falsely claimed that it was a partner of the United Nations on its website and fabricated user comments. Investor Alibaba is the parent company of the South China Morning Post.

Yuanfudao also said it accepts the fine imposed by the regulator, according to its post on Weibo. The company said it “has started self-review and examination of products and channels” as well as corrected its advertising material. The goal is to raise “study efficiency” through “scientific and technological innovation”, while strengthening its business processes and norms, according to Yuanfudao’s post.
The SAMR’s latest action reflects how China’s US$110 billion K-12 off-campus education market, which has struggled during the coronavirus pandemic, is bracing for increased regulation.