A SHENZHEN auto chip dealer and two Shanghai companies were fined a total of 2.5 million yuan (US$387,200) by China’s top market watchdog for price gouging.

It was found that the three companies sold auto chips at a substantial markup, in some cases up to 40 times the purchase price, according to the State Administration for Market Regulation. The markup rate of auto chip traders is normally between 7 and 10 percent in a market with balanced supply and demand.

In the first half of the year, a serious shortage of global auto chip supply triggered a supply-demand imbalance in the domestic market.

In August, the State Administration for Market Regulation launched a nationwide investigation into auto chip dealers over suspicions of price gouging.

Enterprises are required to follow pricing principles of fairness, legality, authenticity and trustworthiness, and to set reasonable prices. (Xinhua)