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Advertising in China: A Multimedia Primer

Advertising in China: A Multimedia Primer. Eion Murdock LEHMAN, LEE & XU Beijing emurdock@lehmanlaw.com www.lehmanlaw.com. Background. China is currently Asia’s largest advertising market Advertising sales revenue hit USD21.85 billion in 2006

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Advertising in China: A Multimedia Primer

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  1. Advertising in China:A Multimedia Primer Eion Murdock LEHMAN, LEE & XU Beijing emurdock@lehmanlaw.com www.lehmanlaw.com

  2. Background • China is currently Asia’s largest advertising market • Advertising sales revenue hit USD21.85 billion in 2006 • There are 1,040,099 people in over 143,129 advertising agencies • China’s growth in advertising is stimulated by: • rapid economic development • deregulation of its markets • 2008 Beijing Olympic Games

  3. Background – Foreign Invested Enterprises (“FIE”) • Advertising sales revenue by FIEs hit USD1.85 billion in 2006, with an increase of 7.8% than 2005 • There are about 8000 people in 2006, an increase of about 54% in 2005, working for 497 advertising agencies • China’s nearly-total opening market to foreign invested enterprises by the end of 2005 has further contributed to growth.

  4. China’s Advertising Law • Regulations on Control of Advertisements (1987) (RCA) • Advertising Law of the People’s Republic of China (1995) (AL) • Detailed Implementing Rules for the Regulation on Advertising (2005) (DIRRA) • Regulations on particular products

  5. Advertisement Approval Procedures • For most advertisements in China, no government pre-approval is required. It is the advertisement media operator who is to decide whether an advertisement is acceptable or not for the its media. However, for outdoor advertisements and advertisements in some special industries, pre-approval is required.

  6. Pre-approvals for advertisements • Outdoor advertisements: local Administration of Industry and Commerce • Ads for tobacco: local Administration of Industry and Commerce • Ads for medical equipment, medicines and health food: State Food and Drug Administration • Ads for veterinary medicines and pesticide: Ministry of Agriculture

  7. Prohibited Content While China’s advertisement law allows most kinds of advertisements, some types of advertisements are highly restricted or prohibited, such as the following:

  8. False and Deceptive Advertisement • Advertisement Law of the People’s Republic of China: • Article 4: An advertisement may not contain any false and deceiving information, and may not cheat or misguide consumers.　 • Law Against Unfair Competition of the People’s Republic of China: • Article 9: An operator shall not use advertisement or other means to give false, misleading information on the quality, origin, performance …

  9. Exaggerated & Misleading Advertisement

  10. Advertisements Related to Stability and Personal Safety • Advertisement Law of People’s Republic of China: • Article 7: Advertisements may not contain any of the following circumstances: • (4)Hindering social stability or endangering the safety of life or property, or harming the social public interests.

  11. Advertisement Violating Good Social Customs • Advertisement Law of People’s Republic of China: • Article 7: Advertisements may not contain any of the following circumstances: • (5)Hindering the social public order or violating the good social customs.

  12. Advertisement against Socialist Cultural Progress • Advertisement Law of People’s Republic of China: • Article 3: An advertisement shall be true to facts, lawful and in compliance with the requirements of raising socialist cultural and ideological progress.

  13. Advertisements that Belittle Other Products • Advertisement Law of People’s Republic of China: • Article 12:An advertisement may not belittle the commodities or services of other producers and manufacturers or operators. • Article 25: Advertisers or advertising operators shall obtain the prior written consent of others before utilizing the names and images of others in advertising.

  14. Ads Using Words that Mean “The Best” • Advertisement Law of People’s Republic of China: • Article 7: Advertisements may not contain any of the following circumstances: • (3) Using such words as the state-level, the highest-level or the best; • Notice on Immediate Cease of Publishing Advertisements Containing Such Contents as “Number One Brand" by the State Administration of Industry and Commerce (1997) • Such words as “Number One Brand” are absolute words with the same meaning as the best.”

  15. Advertisements for Foods and Cosmetics Using Medical Jargon • Advertisement Law of People’s Republic of China: • Article 19: The contents of advertisements for cosmetics must comply with matters and items of hygiene license, and may not use medical jargons or words which are easily to be mixed up with pharmaceuticals. • Pharmaceutical Administration Law of People’s Republic of China: • Article 61:The advertisements of non-pharmaceuticals shall not be involved in the publicizing of pharmaceuticals.

  16. Advertisements for Foods and Cosmetics Using Medical Jargon • Notice on Prohibition of Publicity of Anti-Bacterial and Bacteriostatic Performance of Cosmetics in Advertising: • (3) It is forbidden to have express or implied meaning as “anti-bacterial, bacteriostatic, bacteria relief” or other medical effects on the container, label, instructions and other relevant informational materials in respect of the cosmetics.　

  17. Cosmetic or Food Ads that Include Names of Consumers • Measures on Control over Cosmetics Advertisement: • Article 8: The cosmetic ad may not contain any of the following: • (2)Guaranteeing the efficiency through using names of other people or make people misunderstand the efficiency in an implied way. • Interim Regulations over Publicity of Food Advertising: • Article 9: It is forbidden to use the names or images of relevant experts and consumers as evidence in food advertising.

  18. Ads Not Displaying Certification for Products Being Advertised • Advertisement Law of the People’s Republic of China: • Article 24: The…design, production and publicity of advertisements shall be with or provide such relevant true, legal and valid certifying documents as stated below: … • (2) certificates issued by relevant quality inspection agencies in respect of contents related to the quality of the commodities in the advertising

  19. Conclusion • Advertising is one of China’s most exciting and creative industries. Despite these restrictions, there is ample opportunity to capture the imagination of your target audience. • Advertisements appear virtually everywhere there is space – in supermarkets, in residential building lobbies and in elevators. • Make sure you go in to Chinese advertising as part of a culturally sensitive team – don’t do it alone!

  20. THANK YOU! Eion Murdock LEHMAN, LEE & XU Beijing emurdock@lehmanlaw.com www.lehmanlaw.com

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