Local authorities have shut down a postpartum care center in Shenyang, Liaoning province, following a cluster of neonatal pneumonia infections, the market regulator in the city's Huanggu district said on Saturday.

Services as the Xinxiangyue Shiguang Postpartum Care Center were suspended after nine of the 14 newborns under its care were diagnosed with neonatal pneumonia, it said in a statement, adding that all those involved tested negative for COVID-19.

The market regulator said the center, where mothers could stay with their babies for four weeks after birth, was awaiting thorough disinfection, and the young patients had all received treatment.

It said it will "actively negotiate relevant matters" with the center and babies' relatives, in a tacit reference to compensation arrangements.

The nine babies showed symptoms such as stuffy noses and coughing starting Jan 17.

The baby who first became symptomatic was sent to Shenyang Children's Hospital for treatment on Jan 20, Xinhua News Agency reported.

The hospital later confirmed that the nine babies had caught neonatal pneumonia, Xinhua said, adding that one had been discharged from the hospital after recovering. Severe neonatal pneumonia can lead to death.

Yu Mugang, who oversees the intensive care units for newborns at the hospital, told Xinhua on Saturday the young patients were all in very stable condition.

Some parents said the postpartum care center lacked healthcare expertise.

A father who gave his name only as Li said he sent his baby to the center on Jan 24 and found his child had a runny nose two days later. He was told by a staff member that it was normal.

His child developed a cough on Jan 28, and the center said it would keep the infant under observation. The child was not admitted to an intensive care unit until Feb 2 after developing a high fever, Li told Xinhua.

The center, set up at a site that was first a public bath and then a budget hotel, charged 9,999 yuan ($1,546) for a 28-day postpartum care program. A month's confinement after birth is traditional practice for Chinese mothers and newborns.

A national rule that came into effect in 2017 says maternal and neonatal service providers must implement strict disinfection procedures and prevent cluster infections.

They are not medical institutions overseen by the health authorities and are not allowed to offer medical services.

Market regulators issue licenses to such centers but scramble to oversee their operations, creating a "blind spot", Xinhua said, citing industry insiders.

A report by Intelligence Research Group, a Beijing-based industrial data provider, said the postpartum care sector has seen rapid growth since the universal second-child policy was introduced in 2016, and the size of the market reached more than 15.86 billion yuan in 2019, up from 1.74 billion yuan in 2011.

Customer numbers have grown from less than 40,000 to more than 350,000 in the same period, the report said.