China Economic Network Beijing, March 31, 2019 Recently, a reporter from China Economic Network saw in the Tianyancha App that Shanghai Qumo Culture Communication Co., Ltd. was fined 450,000 yuan by the Pudong New Area Market Supervision and Administration Bureau for helping other operators carry out false or misleading commercial publicity.
According to the Administrative Penalty Decision (Shanghai Municipal Supervision and Pu Bureau [2022] No. 152021002271), after investigation, on December 16, 2020, the parties signed a "Service Order" with Zhengya Dental Technology (Shanghai) Co., Ltd., agreeing that from December 15, 2020 to February 10, 2021, Zhengya Company would randomly recruit 400 traffic bloggers through the parties to promote the invisible brace products it sold on the Xiaohongshu APP. The parties wrote the promotional copy content confirmed by Zhengya Company, and entrusted a company to recruit 400 Xiaohongshu traffic bloggers, requiring traffic bloggers to write promotional pictures and texts based on the content of the promotional copy, the main content of which was about the use experience and positive evaluation of the invisible brace products sold by Zhengya Company, and the parties summarized the above promotional pictures and texts and submitted them to Zhengya Company for final confirmation, and notified 400 traffic bloggers to publish the pictures and texts on their Xiaohongshu APP personal accounts.
After verification, the above-mentioned 400 traffic bloggers were not actual patients or users of Zhengya's invisible braces before and at the time of publication, and the content of the pictures and texts released by them was falsely compiled according to the publicity copy of the parties. On February 25, 2021, the above 400 traffic bloggers completed the release of all promotional graphics. The parties received a service fee of 339,200 yuan (including tax) in the above-mentioned publicity and promotion services. On August 30, 2021, the parties notified the traffic bloggers to delete and remove the promotional images published.
The above conduct violates the second paragraph of article 8 of the Anti-Unfair Competition Law of the People's Republic of China and constitutes an act of assisting other business operators to make false publicity. Comprehensively considering the circumstances and harmful consequences of the parties' illegal acts, in accordance with the first paragraph of Article 20 of the Anti-Unfair Competition Law of the People's Republic of China, the Pudong New Area Market Supervision and Administration Bureau decided to fine Shanghai Qumo Culture Communication Co., Ltd. 450,000 yuan.
Through the inquiry of the reporter of China Economic Network, it was found that Qumo Culture is a content integration marketing service company focusing on the field of beauty and fashion, and its MCN agency "Qumo Culture" focusing on the field of beauty and fashion has dozens of people, as well as rich star artist resources, covering most social platforms and e-commerce platforms such as Taobao Jingdong Vipshop, and has served more than 100 beauty and fashion brands. Wang Yaying is the founder and CEO of Qumo Culture, with a shareholding ratio of 74.6%, and is the largest shareholder and actual controller of the company.
According to Hexun Network news, MCN (Multi-Channel Network) is a kind of Internet celebrity economic operation model, the earliest source of the United States Youtube, it upstream integration and incubation of various types of self-media accounts, downstream to find a promotion platform, playing the role of "brokerage company". MCN agencies help influencer kols to carry out tedious work such as continuous content output, planning packaging, finding platform promotion, data diversion analysis, etc., so that creators can reduce their workload and focus on content production and improve quality.
Article 8 of the Anti-Unfair Competition Law of the People's Republic of China stipulates that business operators shall not make false or misleading commercial publicity about the performance, function, quality, sales status, user evaluation, and honors they have won on their goods, so as to deceive or mislead consumers.
Business operators must not help other business operators conduct false or misleading commercial publicity through methods such as organizing false transactions.
Article 20 of the Anti-Unfair Competition Law of the People's Republic of China stipulates: Where a business operator violates Article 8 of this Law by making false or misleading commercial publicity about his goods, or helps other business operators to conduct false or misleading commercial publicity by organizing false transactions, the supervision and inspection department shall order the illegal conduct to cease and impose a fine of between 200,000 and 1 million yuan; if the circumstances are serious, a fine of between 1 million and 2 million yuan may revoke the business license.
Where business operators violate the provisions of Article 8 of this Law and publish false advertisements, they shall be punished in accordance with the provisions of the "Advertising Law of the People's Republic of China".
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