Friday, 19 August 2016

China Updates- Online Advertising/ Cybersecurity/ Consumer Protection

Online Advertising
Further to the significant changes to its general advertising law last year, China has introduced (effective 1st September, 2016) new measures specifically affecting online advertising. These measures are seen as both a reaction to misleading online advertising and a proactive step to ensure proper regulation.

All forms of direct or indirect commercial advertising through online media are covered, including paid search results.  Some key points include:
  • All media including apps are included.
  • Publishers have an obligation to verify the advertisers and to prevent the publication of non-compliant material. 
  • ‘Pop-up’ ads must include a ‘Close’ button and one click must be sufficient to close the ad.
  • Deception (e.g. misleading indications of what is behind the click) must not be employed to get viewers to click on ads.
  • Online ads for prescription medicines and tobacco are prohibited. Approval is needed to advertise certain other (generally, health-related) products.
  • All advertisements must be easily distinguishable as ads (with the word ‘advertisement’ in Chinese); paid for search results must be prominently distinguished from other search results.
  • Various types of cyber-based unfair competition such as sabotaging competitors’ ads are banned.
Clearly, there will be many areas which will require clarification, including situations which arise from future changes in the internet itself.

On August 12th, it was announced that new mandatory standards would be introduced under the Guidelines to Strengthen National Cybersecurity Standardisation to regulate and standardise matters such as major information technology infrastructure and classified networks.

Consumer Protection
On August 5th, SAIC (the State Administration for Industry and Commerce) issued for comment draft legislation on protection of consumer rights. The draft covers product recall, fraud, online shopping return policies, personal information protection, and the general enforcement of consumer rights including privacy.

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