On April 24, 2015, the PRC Advertising Law was amended for the first time since its promulgation in 1995 and will take effect on September 1, 2015. Lawyers at DLA Piper give some comments on the new law.
The amendments to the Existing Law seek to modernize the legal framework surrounding advertising and address issues which exist in modern day China that could not have been foreseen 20 years ago, when the Existing Law was introduced.
The amended PRC Advertising Law ("Amended Law") gives business a relatively short amount of time to get to grips with the amendments and the practical implications they have on advertising in China.
The existing law is very short and has been widely criticized for being too vague. The amended law is almost double in length and is much more prescriptive, with one of the key aims being to reduce the number of grey areas that exist in the advertising space in China, making compliance and indeed the imposition of sanctions for non-compliance, much more straightforward.
Edward Chatterton, a partner and Ian Jebbit, a registered foreign lawyer at DLA Piper summarize the basic changes to the Amended Law as follows:
1. Misleading Advertising - the amended law provides specific examples of what will constitute a misleading advertisement and thus provides further detail on the scope of what is otherwise a very broad and un-prescriptive definition;
2. Children - the amended law introduces more controls on advertising aimed at children;
3. Communication of advertisements - advertisements must not be sent to home addresses without prior consent;
4. Telecoms - the amended law imposes liability on service providers responsible for communicating advertisements;
5. Product Endorsement - anyone who endorses a product may be held jointly liable for any infringement of the amended law if he or she ought to have known the advertisement infringed the amended law;
6. Sanctions - the amended law introduces wider ranging sanctions including fines of up to RMB1,000,000 (US$150,000) and the imposition of criminal liability and revocation of business licenses for serious instances of infringement.
