On July 1, 2015, China’s State Administration for Industry and Commerce published a draft of the Interim Measures on Supervision of Internet Advertising (“Draft Internet Advertising Measures”; original Chinese here) for public comment. If adopted as drafted, the Draft Internet Advertising Measures would (1) require advertisements in email and instant messaging to contain conspicuous options for the user to agree to, refuse, or unsubscribe from advertisements; (2) require websites to allow users to block pop-ups for certain repeat visitors; and (3) require advertisements sent via email or instant message to identify the sender and be marked as an advertisement. Public comments on the Draft are due by July 31, 2015. Once finalized, the Draft is expected to come into effect on September 1, 2015.

The Draft Internet Advertising Measures would be the first to focus specifically on internet advertising, and primarily serve to the implement China’s recently revised Advertising Law, amended in April 2015 and effective September 1, 2015. The amended Advertising Law prohibits sending electronic advertising without prior consent or request by recipients. Senders are required to disclose their true identity and contact information, and provide a choice to unsubscribe from the advertisements. The amended Advertising Law also requires that the “close” button on internet advertisements must be prominently visible, and that users can close the advertisement with a single action. The Draft Internet Advertising Measures provide more details and specificity on these requirements.

Under the current regulatory framework (i.e., prior to the proposed new requirements in the Draft Internet Advertising Measures), internet advertising is regulated in a less targeted way — generally under broader categories, such as “advertising” or “electronic advertising” — by various provisions of several different laws and administrative rules. These current laws generally prohibit companies from sending advertisements to consumers (such as via SMS or email) without consent, require senders to identify advertising emails as such, and require companies to stop sending advertisements upon explicit refusal by consumers. (See, e.g., Decision of the Standing Committee of the National People’s Congress on Strengthening Network Information Protection, Consumer Rights Protection Law, Advertising Law, and Measures for the Administration of Internet E-mail Services).

The new Draft Internet Advertising Measures more directly regulate advertising activities via the Internet, such as those conducted through websites, email, self-published content (e.g., blogs, WeChat), forums, instant messaging services, and software. In addition to implementing existing rules and regulations (including the amended Advertising Law), the Draft Internet Advertising Measures would provide the following new restrictions:

  1. For advertisements in “private internet spaces” (i.e., email and instant messaging), the advertisement must contain conspicuous options for the user to agree, refuse, or unsubscribe. If a user chooses to unsubscribe from or refuse advertisements, further advertisements are prohibited. Advertisements sent through mobile email and instant messaging services also must provide users with the option to specify the period of time during which their expressed preference will remain valid.
  1. Websites must provide an option to block all pop up advertisements when the same device logs onto the same domain or one of its sub-domains a second time within a 24-hour period.
  1. Advertisements sent to email or instant messaging accounts must identify the source and nature of the email or message in the “from” and “subject” fields, so that users can identify them as advertisements before opening them. This requirement is not completely new. The Measures for the Administration of Internet E-mail Services issued by the Ministry of Industry and Information Technology in 2006 requires that email advertisements should contain “AD” or “广告” (the Chinese characters for “advertisement”) in the subject line.

Once finalized, the new regulation should come into effect at the same time as the amended Advertising Law on September 1, 2015.

The first half of 2015 has been an active time for the development of electronic data privacy laws and regulations. Aside from these Draft Internet Advertising Measures and the newly amended Advertising Law, China has also issued Administrative Rules for Short Message Services (see our blog post on the new SMS rules here), which regulate electronic advertising activities through SMS. Companies advertising to consumers in the Chinese market are advised to monitor this ongoing series of developments as the government increasingly seeks to regulate the country’s rapidly growing e-commerce industry.

Material for this post was supplied by Cairu Huang and Ashwin Kaja of Covington & Burling LLP.

Photo of Eric Carlson Eric Carlson
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Photo of Sheng Huang Sheng Huang

Sheng Huang is of counsel in the firm’s Beijing office. He focuses on China-related practices. He has extensive experience in intellectual property law, specializing in the resolution of Chinese companies’ cross-border intellectual property disputes.

He also assisted international and Chinese clients with their…

Sheng Huang is of counsel in the firm’s Beijing office. He focuses on China-related practices. He has extensive experience in intellectual property law, specializing in the resolution of Chinese companies’ cross-border intellectual property disputes.

He also assisted international and Chinese clients with their intellectual property issues in China.

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Photo of Eric Bosset Eric Bosset

Eric Bosset is a partner whose practice encompasses a broad range of complex litigation matters, with an emphasis on (1) privacy, data security and consumer protection, (2) employment and ERISA, and (3) financial products and services. Eric has extensive experience in class actions…

Eric Bosset is a partner whose practice encompasses a broad range of complex litigation matters, with an emphasis on (1) privacy, data security and consumer protection, (2) employment and ERISA, and (3) financial products and services. Eric has extensive experience in class actions, MDL proceedings, and other multi-party lawsuits. His trial victories include a jury verdict in an employment class action lawsuit that The National Law Journal ranked among the 25 most notable defense verdicts of the year.

Privacy and Consumer Protection

Eric was named “Most Valuable Player” in Privacy & Consumer Protection by Law360. He has an extensive practice representing Internet service providers, publishers and advertisers in class action litigation involving claims of unauthorized collection and disclosure of personally identifiable information (“PII”). He has successfully represented Microsoft, AOL, CBS, McDonald’s, Mazda, the Indianapolis Colts, and other companies in obtaining the dismissals of putative class action lawsuits that asserted federal law claims under the Electronic Communications Privacy Act (“ECPA”), Computer Fraud and Abuse Act (“CFAA”), and Video Privacy Protection Act (“VPPA”), as well as state law claims under the Illinois Biometric Information Privacy Act (“BIPA”) and for unfair practices, trespass, and invasion of privacy.

Eric also represents companies in connection with matters arising under the Fair Credit Reporting Act (“FCRA”), Fair and Accurate Credit Transaction Act (“FACTA”), Telephone Consumer Protection Act (“TCPA”), and other consumer protection statutes.

Employment and ERISA

Eric has extensive experience defending companies in individual and class action litigation brought under federal and state laws concerning discrimination, retaliation, whistleblowing, wage and hour disputes, and wrongful termination, as well as in class action litigation involving the Employee Retirement Income Security Act (“ERISA”). Eric has the rare distinction of having tried and won a jury verdict in a class action lawsuit alleging “pattern or practice” discrimination on the basis of age in connection with a corporate reduction in force. Bush, et al. v. Deere & Company (C.D. Ill.). He also secured the reversal on appeal of a class certification order in a “stock drop” lawsuit that claimed breaches of fiduciary duty in the administration of a company retirement savings plan. In re Schering Plough Corporation ERISA Litig., 589 F.3d 585 (3d Cir. 2009). Eric also represents clients in EEOC investigations.

Financial and Fintech

Eric’s practice includes the representation of financial and fintech companies on a broad array of civil litigation, arbitration, and regulatory enforcement matters relating to financial products and services, including matters for Wells Fargo Bank, JPMorgan Chase, Synchrony Bank, Envestnet, Yodlee, and MidFirst Bank.

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