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China Clarifies Requirements for Marketing via SMS

New clarifying provisions in China regulating how marketing can be done via short message service (“SMS”) will come into effect on June 30, 2015.

On May 28, 2015, the Ministry of Industry and Information Technology (“MIIT”) published measures to implement various high-level provisions related to SMS marketing in several different laws, such as the Decision of the Standing Committee of the National People’s Congress on Strengthening Network Information Protection (“2012 Decision”), the Consumer Rights Protection Law (“CRPL”) and the Advertising Law. Taken together, these pre-existing laws generally prohibit companies from sending commercial communications to consumers without consent, and require companies to (1) comply with express requests from consumers not to send such communications, (2) disclose the identity and contact information of the advertiser in electronic advertising, and (3) provide a way for a consumer to refuse future electronic advertisements.

The newly promulgated measures, entitled the Administrative Rules for Short Message Service and effective June 30, 2015, flesh out these general rules related to SMS marketing. In addition to the general consent and disclosure requirements in the laws listed above, the SMS Rules:

1. Define commercial SMS messages as communications used for introducing or promoting goods, services, or business investment opportunities.

2. Require that if consent to receive commercial SMS messages is requested through SMS, the requesting SMS must specify the “type, frequency, and time limit of proposed SMS” messages. No reply is considered a rejection, and the same or similar requesting SMS must not be sent again.

3. SMS messages containing commercial information must contain a “convenient and effective” way to refuse receipt of such SMS messages in the future, and no obstacles to such refusal are permitted. The message also must expressly contain the name of the content provider (e.g., the advertiser).

4. SMS service providers (e.g., mobile operators such as China Mobile or China Unicom) are required to keep records of commercial SMS messages, including sent time, time of receipt, number or code of the sending and receiving terminals, and information regarding subscriptions and unsubscriptions for at least five months. Subscription and unsubscription information must be maintained for at least five months after the termination of the service relationship between the SMS service provider and recipient.

Failure to comply with requirements 2 and 3 above may result in a fine ranging from RMB 5,000 (about US $800) to RMB 30,000 (about US $4800) imposed by the local Administration of Industry and Commerce, which generally regulates advertising. Failure to keep the records required in item 4 above may be result in a fine ranging from RMB 10,000 (about US $1600) to RMB 30,000 (about US $4800) by MIIT’s local counterpart, and such fine will be publicly announced.

The SMS Rules appear to be in part a response to calls from the general public to combat the high frequency of SMS spam, and part of a broader series of laws and regulations issued by the government in the last 24 months to further regulate collection and use of personal information in marketing.

© 2019 Covington & Burling LLP

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About this Author

Eric Carlson, Litigation Attorney, Covington Law Firm
Partner

Eric Carlson advises clients operating in China and other jurisdictions in Asia on a range of anti-corruption laws, including the Foreign Corrupt Practices Act (FCPA). He has deep experience leading highly sensitive anti-corruption/FCPA investigations in China and other jurisdictions in Asia, including investigations presenting complex legal, political, and reputational risks.​​

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Sheng Huang, Covington, litigation and patent lawyer
Special Counsel

Sheng Huang is special 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.

Representative Matters

  • Certain Batteries and Electrochemical Devices Containing Composite Separators, Components Thereof, and Products Containing Same (ITC Inv. No. 337-TA-1087). Representing OPPO against patent infringement allegations from LG Chem.
  • Certain Wi-Fi Enabled Electronic Devices and Components Thereof Such as Spare Parts (ITC Inv. No. 337-TA-1072). Representing Hisense against patent infringement allegations from Sharp.
  • Certain Carbon and Alloy Steel Products (ITC Inv. No. 337-TA-1002). Representing Baosteel against the allegations of trade secret misappropriation, antitrust and false designation of origin from U.S. Steel. 
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