Regulations of Shanghai Municipality on the Protection of Consumers’ Rights and Interests (Amended in 2022)

September 2022

Jolene Chen and Teresa Huang

The Regulations of Shanghai Municipality on the Protection of Consumers’ Rights and Interests (hereinafter referred to as the “Regulations 2022”) were amended and adopted at the 42th Session of the Standing Committee of the 15th Shanghai Municipal People’s Congress on July 21, 2022 and came into force on August 1, 2022.  This is the second amendment of the Regulations of Shanghai Municipality on the Protection of Consumers’ Rights and Interests since its implementation in 2003.  The Regulations 2022 adds new provisions to protect consumers’ rights and interests according to the current new situation of consumption patterns, which is conducive to enhancing compliance in emerging consumer areas.  This article will briefly introduce the highlights of the Regulations 2022.

Firstly, Paragraph 3 of Article 22 of the Regulations 2022 clearly stipulates that if an operator sells goods and services through Internet media in the form of Internet advertisements such as bidding rankings, it shall prominently mark “advertisement” in accordance with the law.  This provision can avoid misleading consumers’ choice or evaluation of merchants, and will be more conducive to protecting consumers’ right to know.

Secondly, Article 40 of the Regulations 2022 provides the rules for circumstances where an operator provide goods or services to consumers by random selection: the operator shall prominently publicize the selection rules, distribution of goods or services, the quantity of goods and services offered, selection probability and other key information in accordance with the relevant regulation, otherwise it will bear the corresponding legal responsibility, which means that, according to Paragraph 1 of Article 78 of the Regulations 2022, it will be imposed a fine of less than RMB30,000 or in serious cases, a fine of more than RMB30,000 and less than RMB100,000 by the relevant administrative management departments.  The goods and services actually offered by the operator to the market shall be consistent with the publicized content prescribed in the preceding paragraph and the operator shall not tamper with the selection probability or change the selection results.  If an operator violates aforesaid provision, according to Paragraph 2 of Article 78 of the Regulations 2022, it will face the risk of being imposed the following penalties: issuance of a warning, confiscation of the illegal gains, imposition of a fine of between one and ten times the amount of the illegal gains, being ordered to cease business operation for rectification and have its business license revoked etc., by the relevant administrative authorities in accordance with the provisions of the Law of the People’s Republic of China on the Protection of the Rights and Interests of Consumers.

Thirdly, Article 42 of the Regulations 2022 also stipulates that online game operators should fulfill their obligations to protect minors, and online game operators who provide game services to minors shall comply with the requirements of laws, regulations and relevant state regulations on time, duration, consumption restrictions, content, etc.  Online game operators shall, in accordance with the relevant provisions, use electronic identity authentication or other technologies to require minors to use their real identity information to register and log in to the online game.

Fourthly, Article 43 of the Regulations 2022 stipulates the obligations of live streaming marketing platforms and live streaming room operators in protecting the rights and interests of consumers.  For example, a live streaming marketing platform shall carry out identity authentication on live streaming room operators and live streaming marketers.  A live streaming marketing platform shall assist consumers to safeguard their legitimate rights and interests, and provide the relevant records and other necessary information, data, etc., otherwise it will face the risk of being ordered to rectify the situation within a prescribed time limit, imposed a fine, or ordered to cease business operation for rectification.  A live streaming room operator shall indicate the actual operator of the goods or services behind the links and QR codes in the live streaming room.  If a consumer’s legitimate rights and interests are damaged due to using the links, QR codes etc. in a live streaming room to jump to any other platform to buy goods or services, the live streaming room operator who fails to indicate the actual operator shall bear the corresponding responsibility.