Food advertising in China

Chinese’ food and beverage market is growing fast, and food players from all over the world strive to increase their market share.

While advertising campaigns become more and more tailored on Chinese consumers and aggressive, food companies should be very careful not to trespass the limits imposed on advertising by Chinese regulation.

GENERAL PRINCIPLES

The feature-image of this post is the cover of the official campaign launched by Administation of Industry and Commerce to promote information about the new 2015 Advertising law. It says basically: “Let advertising be understood”.

This – in short – is the core of the issue: advertising shall inform, not mislead.

Regulation of advertising is mainly aimed at both protecting the consumer’s faith and fair competition between operators.

 PRC Advertising Law, of amended in 2015, of course provides the main framework; however, PRC Consumer Protection Law of 1993 (amended on 25 October 2013) and PRC Anti-Unfair Competition Law of 1993 also contain relevant provisions.

Advertisements shall not (ii) violate national security, (iii) offend public morality, (iv) discriminate by ethnicity, religion or sex, (v) threatening environment.

PRC national symbols (flag, emblem, anthem), or referral to state organs or their officers, cannot be included in advertisements.

Of course, advertisement shall be true and cannot contain any false or misleading information, in particular about quality, composition, performance, use, producer, shelf life, origin, etc.. Basically, any content shall be objective and able to be supported by evidence.

Advertisements shall be recognizable and cannot be in the format of news report.

Any data, statistics, survey, quotations used in advertisements shall be true and accurate, and the sources shall always be indicated. Claims of patents shall be true and include all references (patent type and number) to the patent, and are only allowed for patents already granted – i.e. mere applications still pending cannot be used.

Although comparative advertising is not clearly and generally forbidden, advertisements cannot belittle or denigrate competitors. Also based on precedents, the safest way is to compare identical/same kind products, as well as not to name the compared product. Comparison shall be as objective as possible, and shall not result into a unilateral view of the good qualities of our products.

SUPERLATIVE EXPRESSIONS

Superlative expressions such as “national level” (国家级) “highest grade” (最高级) or “the best” (最佳) are expressly forbidden, as well as referrals to “the newest science” (最新科学), “the most advanced process” (最先进加工工艺), “the most recent technology” (最新技术).

Such superlative-list is de facto open, as authorities can evaluate on a time-by-time basis whether advertisements convey messages conflicting with the law.

For instance, the following have been deemed equivalent to the superlative expressions forbidden under the Advertising law as well as several opinions/guidelines by authorities:

• any mention of market-share such as “best-sold in the Country” (全国销量第一), “biggest market share” (市场占有率第一), “leader brand on the market” (市场主导品牌) or “consumers’ first choice” (消费者首选品牌)；

• express endorsements such as “brand/product recommended by..” (推荐产品/品牌); “identified by..” (认定); “recognized by..” (×认可)；“shown by..” (展示); “collected by..” (荟萃)； “appointed by..” (指定);

• superlatives such as “famous Chinese brand/product” (中国公认名/品牌), “first brand” (第一品牌) or “ultimate” (极品).

SPECIFIC PROVISIONS FOR FOOD

Because of their unique importance for human life, food products are also subject to specific regulations – mainly, the PRC Food Safety Law, as well as various other regulations – in terms of advertising in addition to the abovementioned general provisions.

Food advertisement shall not be false or even just exaggerated.

Endorsements

Advertising cannot include – under any form – recommendations by food safety regulatory agencies or institutions undertaking food inspection and testing, food industry associations, or customer associations.

Food advertising cannot exploit the title or the image (e.g., by showing a person wearing doctor’s white coat) of doctors and medical organizations; moreover, any statements by experts and consumers – as long as their title or image is stressed – are not allowed.

Under the new Advertising law of 2015, use of endorsers is not allowed for so-called health-food.

Implicit endorsement from other entities or individuals (e.g. celebrities) is allowed, although endorsers can also be held liable in case those advertisements are declared fake or misleading. In a recent case, basketball celebrity Yao Ming appears to have been sued by a consumer in Beijing claiming to have being induced by Yao Ming’s endorsement to purchase some fish-oil pills – which purportedly turned out to be less effective than shown in advertisement.

Avoid confusion with drugs/health food

Food products advertisement shall comply with public health regulations, avoid medical jargon as well as any confusion with pharmaceutical products; claims (explicit or implicit) of disease prevention or treatment functions are strictly forbidden.

Ordinary food (i.e. non-health food) can boast nutritional claims (e.g.: no lactose; low sodium; rich in dietary fiber; fat reduced compared with…; Carbohydrate is the major source of energy for human”) but only in strict compliance with the relevant regulation.

Specific food products

Some regulations are specific to particular food products. For instance:

• baby food advertising cannot show breastfeeding women or infants, nor imply that these products can replace/substitute breast milk;

• alcoholic beverages advertisements shall not (i) show the act of drinking, minors, potential dangerous actions (such as driving cars, boats or planes), (iv) convey implicitly or explicitly the message that those drinks help to release stress, anxiety or increase physical strength, (v) associate personal, business or sport success to their consumption, (vi) declare any prize, positive appraisals/evaluations or awards obtained. Moreover, alcoholic beverages’ advertisements can be published on media (television, radio, newspaper) within specific limits (TV: no more than twice a day between 19-21h and no more than 10 times during normal times; Radio: no more than twice per hour; Newspapers/magazines: no more than twice per issue, and never on first page/cover).

Control on food products advertising has also an impact on import procedures: if specific features – such as awards, certificates, production location, geographical indications, special ingredients – are stressed on the label, it is necessary to provide the authority in charge of label inspection (AQSIQ) with certified supporting evidence. In case of import dairy products (such as milk, cheese, yoghurt, baby formula) labeled with mention of awards, certifications or prizes, the supporting certificates shall be legalized through diplomatic channels.

HEALTH FOOD, NOVEL FOOD, FOOD FOR SPECIAL DIETARY USE

Health food advertising is subject to a specific regulation and procedure, as applicants (i.e. health food companies) need to have all advertising content pre-approved by the local office of the CFDA. Application documents include the certificates and approval for the production or import of the health food, as well as the standards, labels and packaging. The approval lasts for one year.

Functions claims are allowed only – on a very strict basis – for those products which have been successfully registered as “Health Food” (保健食品) with the CFDA – and therefore can display the “blue cap” logo:

Even for approved health food, only the specific claims are allowed (same exact wording as provided by the regulations and approved by CFDA).

It is strictly forbidden for health food any reference or mention to therapeutic claims/effect. However, according to an official release by CFDA on 7 June 2013, around 90% of health food advertisements on television and newspaper appear to have breached this provision.

Health food advertising shall avoid using the following:

• expressions such as “science or research discovers that ..”, “experiments or data prove that..” and similar, as long as they cannot be confirmed/verifies;
• claims that the health food product is a traditional method/recipe;
• referral to “safety”, “no toxic side effects”, “no addictive” etc;
• claims that the health food products is necessary for a normal life.

It is explicitly forbidden comparative advertising between health food and other health foods or drugs.

Health products advertising shall always display the notice “this product cannot replace drugs”; on TV advertising, this notice shall appear for the whole duration of the advertising.

Advertising of health food, novel food and special dietary use food shall display the approval registration number for that specific product.

SANCTIONS

Violation of regulations on advertising can trigger several sanctions, depending on the specific case.

Advertising Law punishes several misconducts of advertisers as well as advertising agents/publishers and even endorsers – with fines up to five times the amount of the advertising expense.

Food Safety Law – and its famous article 148 – allows consumers to claim from either the producer or the seller (i.e. the retailer) punitive damages up to ten times the price paid in case of in case of purchase of food product not complying with food safety standards.

Mis-representation (through advertising or other means) of the quality of own goods or service is also punished by Anti-Unfair Competition Law with fines up to 200,000 RMB.

The Consumer Protection Law also provides grounds for punitive damages in cases considered as fraud to the rights of consumers – e.g. for non-compliant promotions through prizes/awards – up to three time sthe purchase price.