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Draft Internet Advertising Measures Released for Public Comment

2015.07.29 DONG, Xiao (Marissa)、Lena (Qiong) YUAN

The State Administration for Industry and Commerce (“SAIC”) released the Interim Measures for Internet Advertising Supervision and Management (Draft for Comments) (the “Draft Measures”) on July 1, 2015, to solicit public comments. The deadline for comments is July 30. This is a specific regulation with a view to regulating commercial advertising via the Internet (including mobile Internet) following the recent amendment to the Advertising Law (the “New Advertising Law”).  


Definition


The Draft Measures mainly regulate “commercial advertising via the Internet (including mobile Internet)” (Art. 2), including “advertisements as commercial presentations, links, emails, paid search results in the forms of text, picture, audio, video and other forms via various websites, emails, “we” media, forums, instant message tools, software and etc.” (Art. 3). 


We note that the Draft Measures specifically include in their regulatory scope various new popular platforms for advertising in the Internet era, such as “we” media (e.g, Sina Weibo, Tencent Weibo), instant message tools (e.g. Wechat), forums (e.g. Baidu Tieba, Tianya bbs), and software (e.g. Apps for mobile phones). 


Highlights


The following points in the Draft Measures are worth noting:


1. Requirements for Registration with the Administration for Industry and Commerce (the “AIC”)


The Draft Measures require Internet advertising agents and advertisement publishers to register with the AIC, and to publish their AIC registration information in a predominant place on their Internet media. Natural persons that are engaged in Internet advertising or publishing need to engage third party qualified advertising agents. 


2.  Authenticity of Advertisements


In line with the requirement under Article 4 of the New Advertising Law, the Draft Measures require advertisers to be responsible for the authenticity of the content of their advertisements, which requirement is considered to be part of the authorities’ efforts to crack down on false advertising. Furthermore, the Draft Measures require all operators, including advertisers and publishers involved in Internet commercial advertising, to verify the authenticity of the identity of all participants in the entire commercial chain as well as the content of the advertisements.  Through these requirements, the governmental authorities will be able to control the quality of published advertisements and supervise advertising activities. 


3.  Choice by Users


Article 13 of the Draft Measures provides that when publishing advertisements via online private space, such as emails and instant messages, advertisers shall provide users with the choice to consent to, refuse, or cancel subscriptions.  Such election shall be offered predominantly on the advertisement webpage or the advertising platform.  Advertisers are not allowed to send advertisements, such as emails, to users that have refused such advertisements or that have unsubscribed from the mailing lists.  


The Draft Measures further require that advertisements sent by email and instant messages via mobile Internet shall include, as a component of the options to consent, refuse, or unsubscribe, the option to choose the time period for receiving the advertisements.  Unless otherwise agreed by the users, advertisements shall not be sent to users outside of this designated time period.   


This article is consistent with Article 7 of Decision of the Standing Committee of the National People's Congress on Strengthening Network Information Protection (2012) and Article 29 of Law on the Protection of Consumer Rights and Interests (revised in 2014), and includes specific requirements, such as subscription and time period options and the “one-click to close” setting for users.


4.  Distinguishable Advertisements


Compared to information disseminated via traditional media, such as via television, radio, and newspaper advertisements, it is more difficult for consumers to distinguish advertisements on the Internet from other information. Consumers may easily trust the authenticity and accuracy of the content on Internet that is not designated as advertising, but was paid to be published.  Article 16 of the Draft Measures emphasizes that Internet advertisements should be distinguishable in order to provide additional protection to consumers. 


Specifically, the Draft Measures include “paid search results” in the scope of advertisements and require search engine service providers clearly identify any paid search results.  Also, so-called “soft advertisements” fall into the scope of advertising under the Draft Measures and any Internet users, including movie stars and web celebrities, that are paid to recommend and promote products must inform the public of such relationship when the users recommend such products via the Internet. 


5.  Restriction of Unfair Competition


Article 15 of the Draft Measures specifically lists conduct in Internet advertising that is considered unfair competition, for example intercepting, filtering, covering, tampering with, and blocking others’ advertisements.

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