The State Administration for Market Regulation (SAMR) announced the above, alongside six other regulatory bodies, including the Office of the Central Cyberspace Affairs Commission, the Ministry of Culture and Tourism, National Radio and Television Administration, China Banking and Insurance Regulatory Commission, China Securities Regulatory Commission and the China Film Administration.
The overarching aim is to further regulate celebrities’ endorsement activities, in the wake of increasing advertisements that make false claims.
In particular, the announcement pointed out that celebrities should not endorse and advertise health foods and Foods for Special Medical Purposes (FSMP).
Companies that are from the healthcare, pharmaceutical, healthcare equipment, and health foods industries are also not allowed to engage any spokesperson for product advertising and publicity.
“In recent years, some well-known artists, entertainers, online influencers etc – which we shall term as celebrities – were involved in illegal, fake advertising, or even promoted the wrong values in their endorsement activities.
“Some of the enterprises also regarded traffic as utmost important, and selected celebrities who have broken the law or moral rules to endorse their products,” the announcement said, adding that such activities have harmed consumer rights.
Responding to queries from NutraIngredients-Asia, experts pointed out that the ban on celebrities’ endorsement of health foods was not a new law, but the announcement was made to reiterate the government’s stance.
“The regulation on celebrity endorsement of health products, including medical treatment, drugs, medical devices, health supplements, is not a recent guideline.
“It was promulgated in China's Advertising Law in 2015. In China, celebrity endorsement of health products is prohibited by law.
“However, in recent years, many overseas health care products enterprises are still hiring Chinese celebrities for advertising. This is considered a grey area by the government. As a result, this announcement would suggest that the government wants to stamp this out,” Ashley Dudarenok, founder of Hong Kong-based Chinese digital marketing agency Alarice said.
Earlier this year, Chinese actress Jing Tian was fined RMB$7.22m (US$1.08m) for engaging in a sales campaign to endorse a fruit and vegetable candy which the Chinese authorities had construed as fake advertising.
The candy, made by Guangzhou-based Infinite Free, was marketed as a weight loss product that claims to help prevent the body from absorbing sugars, oils, and fats.
The company involved was also fined RMB$4.64 million, South China Morning Post reported.
Cathy Yu, senior food regulatory consultant and GM of the food business division at CIRS also said that companies would need to comply with the rules stated in the announcement.
In fact, aside from celebrities, health foods brands are not allowed to engage anyone to endorse their products, according to the Advertising Law, Yu pointed out.
Where does the ban apply?
The ban would apply to advertising space across online, offline, TV commercials, and social media channels, so long as they are shown in China.
“The ban also means that the definition of endorsement has expanded.
“Not only do common TV ads belong to endorsement, but soft ads such as online and offline entertainment programs, interview shows, and other forms of promotion will also be regulated.
“Most importantly, for online live streaming, social media and other new forms of endorsement, brands also need to comply with the regulations,” Dudarenok said.
However, Chinese celebrities would still be able to endorse health products outside of China through their engagements with overseas firms.
“For the Chinese government, to them, they cannot control what the celebrities are doing in other countries. So, what I can control is in China and I can regulate how and what is allowed and what's not allowed, but I cannot prevent celebrities from my country to advertise and engage in these activities outside of my country.
“So for instance, I cannot prohibit the Chinese celebrities to sign an advertising deal with a healthcare provider from the US. But what I can do is to prevent them putting this advertisement in the public domain in China,” she said.
Why reiterate this at this point?
Asked the reason for reiterating this ban at this point, Dudarenok said that this could be because the Chinese government was trying to ‘clean up’ its online space as it sought to strengthen its digital economy.
“Why China is talking about this now? It is a big campaign to regulate the digital economy, because we have just been through the China National Congress, where the government has identified the focus for the next five year.
“The focus is on the digital economy, artificial intelligence (AI), the development of technology, the development of blended reality, or metaverse, and to develop all that, you need to clean your house.
“So, what they're trying to do is they're trying to keep their house clean and of course, in their own way, trying to control the market as well,” she said.
In the recent China National Congress, Chinese President Xi Jinping has labelled AI and new energy sectors as the new engines of future growth.