False Advertising and Commercial Bribery in China: The 2025 Anti-Unfair Competition Law

Introduction

Two of the most expensive mistakes a foreign company makes in China are invisible until a regulator or a competitor points them out: a marketing claim that reads as a fact but cannot be supported, and a payment to a customer's employee or an intermediary that was meant to smooth a deal. China's Anti-Unfair Competition Law was revised in 2025 and took effect on 15 October 2025, and the revision redrew both lines — renumbering the provisions, widening what counts as bribery, and raising the stakes on false advertising. A company still reading the 2017 text is working from a statute that no longer applies.

Commercial Bribery: Article 8, Now Drawn Wider

The commercial-bribery prohibition now sits in Article 8 of the 2025 law. The core prohibition is familiar: a business operator must not use money, property or other means to bribe the counterparty's employee, the counterparty itself in a transaction, or an entrusted party, in order to obtain a transaction opportunity or a competitive advantage. What the 2025 revision tightened is the reach of "other means" — hidden benefits, disguised payments routed through intermediaries, and advantages that never appear as cash on a ledger are the target. A foreign company's channel programme is where the line is crossed most often: a rebate paid to the buyer's own purchasing staff, a "consulting fee" to an agent who is really the customer's employee, or a travel-and-gifts programme aimed at the person who signs the order. The offence is judged by purpose — seeking the deal or the advantage — not by the label on the payment. The penalty provision is Article 24, under which the fine can reach RMB 5 million, alongside confiscation of illegal gains and, in serious cases, licence consequences.

False Advertising: Article 9, and the Fine That Scales

The false-advertising prohibition now sits in Article 9: a business operator must not make false or misleading commercial promotions about its goods — their performance, function, quality, sales status, user reviews or honours. The language matters more than most companies realise: a claim can be misleading even when it is technically true, if the way it is presented is capable of deceiving consumers about the product's real nature. "Bestseller", "No. 1 in sales", "clinically proven", "military grade" — each of these is a factual assertion that a regulator can ask to be proved. The penalty provision is Article 25: the authority may order the conduct stopped and the effects eliminated, and impose a fine of up to RMB 1 million, rising to RMB 1 million to 2 million in serious cases. The difference between the ordinary and the serious band is not defined by the statute alone — it turns on the scale and consequences of the misleading promotion, which is precisely why the supporting evidence for a claim should be assembled before the claim is published, not after the investigation opens.

Punitive Damages: Trade Secrets Only

One point that is routinely overstated: the 2025 law's punitive damages do not attach to every violation. Punitive damages are available only for misappropriation of trade secrets — under Article 22(3), where the misappropriation is malicious and the circumstances are serious, the court may award damages at one to five times the amount of the loss or the infringer's gain. False advertising and commercial bribery are administrative-liability regimes; they do not carry this punitive multiplier. The distinction is practical: a trade-secret theft can generate a five-times civil award on top of administrative penalties, while an advertising or bribery case runs mainly through administrative fines and confiscation — plus, for bribery, potential criminal exposure under the separate bribery offences. Keep the three tracks — administrative, civil and criminal — separate when you model the risk.

Practical Points for a Foreign Company

• Map every "relationship payment". Trace rebates, consulting fees, agency commissions and gifts to their true recipient, and ask whose decision each one is meant to influence — that is the Article 8 test.
• Keep the evidence for every claim. For each marketing assertion, keep the study, the sales data or the award that proves it, or delete the claim — that is the Article 9 test.
• Read the 2025 numbering. Commercial bribery is Article 8 (penalty Article 24), false advertising is Article 9 (penalty Article 25), and punitive damages are Article 22(3) for trade secrets — not a general rule.
• Screen the marketing calendar. "Bestseller", rankings, star ratings and test results are the claims regulators ask about first.
• Treat trade secrets separately. If a competitor or former employee took your secrets, the punitive-damages route is where the serious civil recovery sits — see China Anti-Unfair Competition and Trade Secrets: Protection for Foreign Companies, and for the consumer-facing side of marketing claims, China Advertising Law: A Compliance Guide for Foreign Brands.

How Tianni Law Firm Can Help

Tianni Law Firm (江苏天倪律师事务所), based in Nanjing, Jiangsu, advises foreign companies on China's competition-law exposure — reviewing channel and marketing programmes against Articles 8 and 9 of the 2025 Anti-Unfair Competition Law, building the evidence file behind advertising claims, responding to administrative investigations, and pursuing trade-secret remedies including the Article 22(3) punitive-damages route. This article is general information, not legal advice; the 2025 law and its implementing rules continue to be applied by regulators and courts, so confirm the current official text and enforcement practice before relying on any specific reading.