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Self-Regulation in China

Self-Regulation in China. Edward Lehman LEHMAN, LEE & XU 16 November 2007. Overview of China’s Advertising Regulatory Structure. Before & Now. Business Revenue of China’s Advertising from 1990-2006 [Unit: one hundred million Yuan (RMB)] [Source: State Administration of Industry & Commerce].

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Self-Regulation in China

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  1. Self-Regulation in China Edward Lehman LEHMAN, LEE & XU 16 November 2007

  2. Overview of China’s Advertising Regulatory Structure

  3. Before & Now

  4. Business Revenue of China’sAdvertising from 1990-2006[Unit: one hundred million Yuan (RMB)][Source: State Administration of Industry & Commerce]

  5. Global Advertising Market Share 2004[Source: iReserachGroup]

  6. Functions of Advertising Administrative Organs

  7. Guide Organizations within the Industry Formulate Administrative Rules Development Planning for the Advertising Industry Qualification Examination and Approval of Operation of Advertising Prior Examination of Special Advertising Administrative Investigation and Disposal of Illegal Advertising Administration, Law Execution and Supervision

  8. AIC of Provinces and Municipalities directly under Central Government Prefecture AIC Prefecture AIC County AIC CountyAIC County AIC Dept. of AIC Dept. of AIC Dept. of AIC Dept. of AIC Dept. of AIC Dept. of AIC Advertising Administrative Structure State Administration for Industry and Commerce (SAIC)

  9. State Administration for Industry & Commerce Local AIC Supervision over Advertising Industry Prior Examination of Ads By Chinese Governmental Departments Administration of Radio, Film & TV Ministry of Health General Admin. of Press & Publication Ministry of Agriculture Food & Drug Administration Ministry of Info. Industry

  10. Roles & Functions of AICs • Department of Advertising Regulation of SAIC is the competent authority directly under the State Council in charge of drafting and enforcing regulations and the implementation rules thereof. • AICs are in charge of market supervision/regulation and related law enforcement through administrative means.

  11. Any person, either natural or legal, who alleges that the advertising operators have infringed their legitimate rights and caused damages to their properties or other rights may report the case to the competent AIC who will grant an administrative decision upon the case. Either party may appeal to the AIC at the next higher level or bring a suit directly to the people’s court if they are not happy with the decisions.

  12. Additional Approvals for Special Products • Approvals are needed for the advertisements of health foods, pharmaceuticals and medical equipment from the Administration of Foods and Pharmaceuticals. • Approvals are needed for the advertisements of tobaccos and outdoor advertisements from the AIC. • Approvals are needed for the advertisements of pesticides and animal drugs from the government agencies of agriculture.

  13. Self-Regulationin China

  14. China Advertising Association (CAA) • It is a self-regulatory entity, but to a certain extent, supervised by SAIC • Its main mission is to provide consultation and legal opinions to advertising operators and agencies set up under supervision of SAIC • Their opinions are not final but are accepted by competent government agencies more often than not in view of their experience and connection with SAIC

  15. Advertising Agency, Media, Advertiser Certifying Documents Advertisement Presentation Advertisement Production Examination of characters & images Certificate of Substantial Examination Product Agreement to produce & Notice of Prelim. Exam. Idea Advertising Consultation Procedure Notice of Preliminary Examination & comments

  16. Advantages of Consultation Process • CAA has close connection with Department of Advertising Regulation of SAIC and is abreast of legal development and new guidelines • Consultation process is voluntary • CAA adopts a two-pronged examination process • CAA is responsible for rectifying problems that arise after consultation & authentication

  17. Ways To Improve Efficiency of Advertising Self-Regulation • Entrust more powers and responsibilities to Legal Consultative Commission of CAA • Extend the scope of self-regulation • Increase transparency and awareness of self-regulation • Establish advertising dispute settlement and complaint resolution mechanisms

  18. Edward E. Lehman Lehman Lee & Xu Chinese Law Firm with a Global Perspective Beijing, China elehman@lehmanlaw.com www.lehmanlaw.com

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