State authorities said this week they would impose a blanket ban on celebrities endorsing foods for Special Medical Purposes (FSMP) as well as tobacco-based products (including e-cigarettes), off-campus education, medical care, medicines, and medical devices.

“Celebrities should consciously practice socialist core values in their advertising endorsement activities, and endorsement activities should conform to social morals and traditional virtues,” the regulations said.

“In recent years, some well-known artists, entertainers, online influencers etc – which we shall term as celebrities – were involved in illegal, fake advertising, or even promoted the wrong values in their endorsement activities.“

In direct criticism to companies that use celebrities, the statement added that enterprises regarded traffic as of “utmost importance” and had seleced celebrities who had broken the law or moral rules to endorse their products.

The announcement, which came into force earlier this week and was jointly issued by seven Chinese government institutions, urged companies to boycott celebrities who engaged in illegal behaviour such as drug addiction, gambling, drunk driving, indecent assault, tax evasion and fraud.

Regulations will uphold moral integrity

The move is seen as a response to a number of recent scandals involving some of China’s most popular celebrities that has seen them become blacklisted in the entertainment industry.

According to the authorities, the introductions of the regulations was an attempt to address celebrities illegally or falsely endorsing “bad ideas”.

Zhang Guohua, president of China’s advertising association, said the regulations would contribute to a “more standardised and healthy improvement” of the industry.

Zhang added “This does not mean that celebrity endorsements will be limited, but everyone will be more cautious, and the artists will be more responsible and self-disciplined.

“As long as the law is complied with, celebrity endorsements will still be carried out normally within the scope of compliance and legality, so the impact is positive.”

He said those who had “enjoyed the benefits of being a public figure” should prepare to be restrained in their actions because of their influence as role models.

“You have such an industry status and influence, so you should be cautious in your words and deeds,” he added.

Mengniu terminates contract of celebrity singer

While celebrity endorsement is a relatively new concept for China, several personalities have lent their name to a product only to fall from grace in the public eye, causing financial and reputational damage to associated brands.

Last year, Show Lo Chih Hsiang, a Taiwanese singer and actor parted ways with dairy brand Mengniu 24 hours after signing a lucrative endorsement contract.

The agreement was immediately terminated after his long-term girlfriend revealed that he was a serial cheater in a message posted on Chinese microblogging website Weibo.

Chinese actress fined for false claims

In June of this year, Chinese actress Jing Tian was fined RMB7.22 million (€980K) for advertising a weight management product that authorities said made false claims about its effectiveness.

Tian, who was brand ambassador for Infinite Free, claimed a fruit and vegetable-based confectionery could prevent sugars, oils and fats from absorbing in the body – a claim rejected by the State Administration for Market Regulation (AMR).

The actress later apologised on Weibo, stating that she had not done enough due diligence on the product prior to signing the contract.

“I fully accepted the penalty and paid the fine immediately. In future, I will continue to take responsibility for the products I endorse to consumers,” she said.

Commenting on the implications of the new regulation, Ashley Jia from Shanghai law firm HFG Law & Intellectual Property, said the rules now emphasised the punishment on the celebrity themselves.

“Most celebrities will use the name of their agency or company to enter the endorsement contract with the advertisers, but the guideline further emphasises that if the ads violate the regulation, then celebrities themselves shall bear relevant responsibility as well,” Jia said.

Citing the example of Tian, the AMR fined her directly rather than imposing the fine to her company or agency.

“With such regulation, the celebrity will be difficult to escape from the potential punishment after breaching the Ad law.”

Jia also pointed out that the guideline stipulated that the celebrities needed to actually use the commodity before the endorsement and ensure that the usage time or quantity was sufficient to produce daily consumption experience.

“If the celebrities act as the brand ambassador, they need to specify the exact name of the product they have experienced,” Jia added.