Advertising law in China has taken a new turn, and is now going after the official WeChat accounts of companies and artists. More and more companies, both local and foreign owned, are being handed penalties for using terms such as “the best”, “one hundred percent”, “first”, “most advanced”, and “lowest price” on their social media accounts. To discuss social media marketing law in more detail, we met with two Shanghai officials.
I – What is a violation of advertisement law?
II – What will happen to you and your WeChat account if you violate the advertising law?
III – How much is the penalty for violating Advertising law in China?
IV – Avoiding trouble on your WeChat account?
According to the Marketing Supervision and Administration of Jing’An district (静安区市场监督管理局曹家渡市场监管所), any information published on an official WeChat, Weibo or any other company account is as just as relevant as the information contained on an official website or in advertising material, and is therefore considered advertising. Moreover, any individual who reports a valid violation of consumer rights in China receives a cash prize.
Needless to say, some individuals are making a living out of this legal condition, and spend their time browsing on the internet, looking for violations. Once an applicant has sent his report, the officials have two weeks to investigate and report to the higher authority as well as to the applicant. In the case where a law has been broken and the application is legitimate, the brand/social media account holder will be penalized, and the applicant will receive a prize.
What is a violation of advertisement law?
Any content posted on your WeChat account suggesting that something is the ‘best of its kind’, has the lowest or highest price on the market, is in any way extraordinary, promotes health, cures sickness or problems, uses the newest technology, is the most welcomed, etc. may be in breach of the regulations.
Words to avoid are: 100 percent, Number one, top, super, everlasting, etc.
Any non truthful fact, especially at a national level: China’s most…, recommended by China’s respected doctor/expert etc., using a design of national currency or design similar to Chinese Yuan, etc.
Connected to a false promise: click here to receive a prize, draw a prize, try out for free, etc.
Provides false guidance: prevents sickness, don’t miss the last opportunity, cheaper than ever, flash discount, rush to purchase, etc.
Anything connected to brand’s status: golden brand, big brand, famous brand, big star, leader in a field, outstanding, king of…, champion, etc.
There are also a few marketing tricks brands no longer can use, most of which are connected to unclear time limitations, unproven or false brand history facts (since XXXX year), general historic facts (“never before”, “unprecedented in the nation’s history”), and having buttons that lead to a page different from the one indicated (“click here to receive…”), etc.
In simple terms, advertisements should be identifiable by consumers as advertisements. Mass media must not publish advertisements in disguised form, such as in the form of news reports, or ‘advertorials’. Advertisements published through mass media should be marked with “advertisements”, which are different from other non-advertising information and should not cause misunderstanding among consumers.
Other such regulations can be found in the second revision of the China’s commercial and advertisement law.
Since the authorities now have their eyes on WeChat official accounts, more and more companies are asking content providers and communication agencies to assure their content complies with the regulations.
What will happen to you and your WeChat account if you violate the advertising law?
The procedure for the investigation and penalization of a social media account, including a WeChat account is quite simple. The official representatives of your district will call your office to confirm your address and will arrange a time to visit (usually the very next day). Most likely you will not know any details before their visit, except the name of the account reported.
During the the visit, representatives will ask a few questions about the sensitive content. They will check your business license and business scope, the reasons why you post on WeChat and if those posts bring you any commercial gain. This will then lead a tax-related conversation.
After the conversation, they will ask you to provide a written explanation as to why the situation arose in the first place (from “I was not aware of the law”, to “I posted it on purpose”). You will also need to support the statement with the necessary documents and contracts (in case your agency is in charge of someone else’s content, or if your content is created by a sub-contractor).
Then, all that remains is to see whether the case will be dropped, or if a fine will be applied for you to pay.
How much is the penalty for violating Advertising law in China?
According to the Advertising law of China, depending on the type of violation and outcome, the fine starts at 10,000 Yuan and can reach as much as 1 million Yuan with a suspension of the business license.
Avoiding trouble on your WeChat account
Firstly, make sure you or those working on your content have read the law and are not using any forbidden terms, subjects, or any of the marketing tricks mentioned above.
Secondly, make sure that all your existing content on WeChat account, Weibo, E-commerce platforms, Website, Mini-apps, etc. does not violate the law.
If you are concerned about this legislation and need help checking and editing the legal compliance of your content, keep in mind that HI-COM has been providing such a service for the past two years and has already helped hundreds of companies avoid legal trouble. Contact us now and get some answers for free!
If your content is already under investigation, please seek legal help.
Disclaimer: The information mentioned in the above article should not be considered as legal advice. HI-COM is not a law firm, and is not authorized to provide legal advice. However, we are in a position to proofread and edit your content in accordance with the advertising law regulations of China.