Many of our clients operating in China now have their own public WeChat account by which they promote their own products or services to subscribers. Unfortunately most may not know that content published in such a way is subject to China’s Advertisement Law.
Our firm has been working with a client who has become subject to an investigation from the Administration of Industry of Commerce. The companies WeChat account was reported based on violation of the Advertisement Law. Their WeChat posts had simply made the statement that their product was the first of its kind to come to market in its industry. When our firm was first approached by the client in this matter the client was angry and incredulous. Their thinking went something like this,
“We are operating this WeChat account independently, we aren’t engaging any services of an advertising agency, and in any case, our content is going primarily to the small number of people who have subscribed to our account, not the general public, so how can this be a violation of the Advertisement Law? We aren’t even sure if we are generating any income or clients with this anyway.”
Unfortunately, the answer is Yes, even though there is absolutely no income directly generated from running this public WeChat, and the content is reaching only a small number of people which have all voluntarily signed up self promotion. The updates modified the law to regulate advertising behavior and content whether or not ads are published on traditional media or new media, or they are made and published by an Advertising Agency reaching millions or directly by the products or services provider and reaching only a few people.
Back to the client reported to the AIC. It is the company’s responsibility to prove with convincing evidence that statements made in advertising materials are accurate and true. In this case the client had to go through a long and tedious paper chase in search of real documentation and hard facts to prove that their product was indeed the first of its kind to market. If they are unable to do so to the satisfaction of the AIC investigators fines are on the table.
Advertisement Law is a big deal to Chinese regulators who are working to make sure unsuspecting customers aren’t mislead by products which overpromise. Every company should have a basic understanding of China’s Advertisement Law, or better yet, regularly consult with a China Lawyer regarding advertisement content. Remember, what can’t be put on the TV, a newspaper or magazine, can’t be put on WeChat or other social media.