State Administration of Market Regulation is going to investigate and punish illegal acts in live webcast marketing as violation of lawful rights of consumers, violation of intellectual property and damage of market order aiming to protect consumers’ rights and promote healthier development for live webcast marketing. Shanghai Dongjin finds the highlighted points as follows:

First is to clarify legal responsibilities of relative parties. For website platforms which provide services for operators as online business places, deal making and information publishing in order to open independent mutual or multi-party transactions, they shall fulfill their responsibilities and obligations according to the E-Commerce Law and the Advertising Law. For operators which sell commodities or provide services through the Internet, they shall be restrained by the E-Commerce Law, the Advertising Law, the Law of Protection of Consumer Rights and Interests, the Anti-Unfair Competition Law, the Food Safety Law, the Price Law, the Patent Law and the Trademark Law. For live performers for online propagandas, they shall follow the Anti-Unfair Competition Law and the Advertising Law.

Second is to strictly regulate live webcast marketing. Standardize the scope of commodity or service marketing, establish and implement the inspection and acceptance system, set limitation for those commodities and services which are prohibited to produce or sell, or prohibited to transact through the Internet, or commercial ads which are prohibited to publish on public media. Standard reviews before releasing for advertising which includes ranges of medical, pharmaceutical, medical devices, pesticides, veterinary drugs, health foods and formula foods for special medical uses. Protect consumers' rights of information and choices, operators shall show the relative administrative licenses prominently of their home pages and provide address, contacts and after-sale service to consumers.

Third is to investigate and punish illegal acts. Those include e-commerce illegal act as unauthorized deletion of consumer comments, violation of lawful rights of consumers as deliberately delaying or unreasonably refusing after-sales service, illicit competition as fiction of trade or comment to deceive and mislead consumers, illegal production quality as selling fake or inferior products; intellectual property violations for exclusive registered trademarks and fake patents; illegal acts for food safety as selling food without license, selling food that does not meet food safety standards, selling food with false production date or beyond the shelf life; illegal advertisements as fake ad or illegal ad which is contrary to good social morality; and illegal prices as Push-up price and using fake price or misleading price to deceive consumers.

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Mr. Mike Chang (Partner)

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Email: mikechang@shanghaiinvest.com