The impact of the administration regarding advertising from the second half of 2023 on advertisers

In mid-June 2023, the General Office of the SAMR issued the “Notice of the General Office of the SAMR on Solidly Conducting the Investigation and Governance of Prominent Issues in the Field of Advertising Administration” (hereinafter referred to as the “Notice”). This “Notice” reflects the key aspects of the administration regarding advertising. The “Notice” is very brief, mainly proposing specific administrative requirements and measures for 10 aspects. The following is a brief introduction and explanation from the perspective of the impact of the “Notice” on advertisers.

1. Reduce the burden in three aspects of “three products and one equipment”

The term “three products and one device” refers to food, drugs, cosmetics, and medical devices. China has formulated regulations and rules for the advertising of these four types of products, and strictly implements the requirement of prior review in the administrative management process, which increases the responsibilities and risks brought by the subjectivity of advertising review for advertisers. Based on this, the “Notice” stipulates that advertising review services for “three products and one device” should be normalized, convenient, and standardized. From the content of these three requirements, we believe that this is a measure to reduce the burden on advertisers. Because the normalization is the burden of the authorities which shall review relevant advertisements, that is those authorities shall promptly discover and correct illegal or improper behaviors in the implementation of administrative approvals; the biggest feature of facilitation is to deepen the “cross provincial approval”, enabling the sharing of advertising data and facilitating unified regulatory standards; and the standardization refers to the comprehensive implementation of administrative licensing item list management, the preparation of “three products and one device” advertising review guidelines, and the standardization of review standards.

2. Put pressure on advertising operators in traditional media

The “Notice” requires to promote the improvement of advertising compliance operation of traditional media units, and compact the main responsibilities of traditional media units such as radio stations and television stations. We believe that advertising operators in traditional media have rich advertising experience, and they should have shown their ability of compliance review. This pressure on integrity administration has reduced the pressure of advertisers as laymen.

3. Key areas of administrative enforcement

The “Notice” introduces that the administrative enforcement would be carried out in the field of internet advertising, and new forms of advertising such as live streaming sales ads, pop-up ads, and “soft text” ads, and increasing efforts to clean up and rectify internet advertising chaos, would also be a key area.

4. Coordination between supervision and administrative enforcement

The “Notice” proposes to fully leverage the role of the joint meeting mechanism for rectifying false and illegal advertisements, strengthen cross departmental comprehensive supervision, and focus on solving prominent problems, such as more punishment less supervision, repeated punishment for repeated offenses. At the same time, cross regional horizontal coordination in administrative enforcement would be actively carried out, and strengthen the administrative investigation on illegal advertisers, advertising operators, advertising publishers, and advertising spokespersons.