Study On Legal Regulations Concerning Endorsements And Testimonials In Advertising

With the rapid development of our market economy, the endorsing advertisement (academic circles generally call an advertisement by a spokesperson or a testimonial advertisement) also gets into the prosperous period of development. Therefore, more and more persons follow the way to endorse in advertising. In recent years, many misleading or unsubstantiated endorsing advertisements have been exposed and the phenomenon of misleading endorsements has become an improper practice strongly complained by the whole society. Consequently, the litigations between consumers and endorsers often appear in various media reports. China hasn't formulated specialized norms concerning the endorsements in advertising and the related rules are scattered. In a real sense, the codes of conduct about the endorsements are few. Compared with the United States and our Taiwan region, where there are more advanced rules and regulations, our legal system seems to fall behind. The "endorsing scandals" in China occurred repeatedly also exposed the systematic flaws of our legal regulations concerning the endorsements in advertising. Legislators should pay more attention to this issue. Under this background, aiming at following focuses:the basic issues of the endorsements in advertising, the behavior norms of the endorsements, the analysis of liability for the endorsements, and the reference and perfecting of the legal regulations concerning the endorsements in advertising etc., this dissertation would do deep and systematic research.In addition to introduction and conclusion, the paper totally is divided into four parts with 260,000 words.Firstly, it is concerning the basic issues of the endorsements in advertising. An endorsement in advertising is an advertising conduct by a party with his or her own name other than the advertiser who directly or indirectly recommends the product or service, or attests its quality, function and effect etc. to attract consumers, win their trust and persuade them to purchase the product or take a service. The endorsement has typical characteristics of "personality", "publicity and credibility" and "implicit guaranty" as well. The effective principles of the endorsements include the source credibility theory, the source attractiveness theory and the meaning transfer theory. The endorsements have functions to deliver business information, attract public attentions and enhance public trust and so on. The recognition of the true or deceptive endorsements should be beneficial to consumers:(1) insist on objective standard; and (2) adopt subjective standard of the reasonable person. The legal relationship of the endorsements is the specific performance that the relationship of the endorsements in advertising is reflected from the legal norms on the endorsements. It is a typical many-sided legal relationship. An endorser is neither an advertising performer or an employee of an advertiser, nor an agent or a guarantor under the law. In fact, the endorser is a party who is responsible for the truth of the representations in advertising as a "implicit guarantor". The endorser must undertake the legal obligations to make true endorsements and the consumer consequently has the right to learn the truth. Facing to the endorsements in advertising in great confusion in China, the rigid clauses are needed. The large scale of the endorsements in advertising and the frequent occurrence of "endorsing scandals" provided a realistic foundation for the legal regulations. The misleading endorsements will produce seriously social harm, while the consumptive decision of consumers will be influenced seriously by the endorsements. These facts provide a jurisprudential foundation for the legal regulations.Secondly, it is concerning the codes of conduct of the endorsements in advertising. The endorsements should comply with principles as follows:authenticity, legitimacy, good faith, social responsibility, common but distinguishing responsibility etc.. Among them the authenticity principle is even the most fundamental. The identity confirmation of an endorser is the basic premise for the legal regulations. To give a true endorsement should be the most fundamental criterion of the endorser. When the advertisement expresses or implies that the endorser uses the endorsed product, the endorser must have been a bona fide user, or the advertiser should clearly disclose that the endorser is not an actual consumer of the product, or explicitly instruct that the advertisement is only for performance. When there exists a connection between the endorser and the advertiser that will materially affect the weight or credibility of the endorsements and that can not be inferred reasonably by the consumer, such connection must be fully disclosed. Whenever the advertisement represents, directly or by implication, that the endorser is an expert in the area of the endorsed product, then the endorser's qualifications must in fact give the endorser the expertise that he or she is represented as possessing with respect to the endorsements. It is necessary for the endorser to be liable for the investigations of the advertisement before he or she makes an endorsement. Moreover, the advertiser is liable for the honest use, confirmation and supervision of the endorser's endorsements. The advertiser is subject to liability for misleading or unsubstantiated representations made by the endorser and the endorser is also liable for the authenticity of the endorsements. In consideration of the individual difference of the experience of curative effect and uncertainty itself, furthermore, regarding of our current deficient advertising legal system, the curative effect of medicine products in the medical advertisements should be prohibited to disseminate through the endorsements. To protect the conduct of the endorsements in advertising strongly is as important as to restrict it essentially. Concerning the relationship between the endorsement and the performance in advertising, the endorsement is a true "performance" in advertising.Thirdly, it is concerning the liability analysis of the endorsements in advertising. As for the issue whether the endorser should be liable for his or her illegal endorsements, the academic circles mainly have two standpoints of "affirmation theory" and "negation theory". This paper holds that as long as the illegal endorsements conform with constitutive requirements of the liability, the endorser has no reason to succeed in evading it. The legal basis of the liability for the endorsements lies in the protection to the trust benefits of consumers and the restraint to the deceitful representations of endorsers. Concerning the nature of the civil liability for the endorsements, academic circles have some theories as follows:joint liability, limited liability, several liability, supplementary liability, correspondent liability and different liability and so on. This paper holds that the essence of the civil liability for the endorsements is a joint liability and the joint foundation lies in the theory of contributory torts. However, it is unfair for the endorser to be subject to joint liability for his or her mere general negligence. In this circumstances the endorser should bear the limited joint liability. As for the understanding of the criterion of liability about the civil liability for the endorsements in food advertisements established by section 55 of Food Safety Law of PRC, there are great differences at academic circles. And the arguments concerning the criterion of liability about the civil liability of the endorsements are more complicated. According to this paper, the liability for the endorsements neither conforms with the reasons of related legal policy created by no-fault liability, nor possesses the objective basis for it. In my opinion, it is suitable for the presumption of fault. It is necessary to divide the endorser's subjective faults into gross negligence and general negligence. To determine the intention of the endorser we should insist on the subjective standard of judgment. However, to determine the endorser's negligence we should persist in the objective standard of judgment through judging whether the endorser violates the relevant obligations of care. As for the determination of the causation of the endorser's liability, to distinguish between the causation in fact and the causation in law is necessary. We shouldn't rigidly apply with the "indispensable conditions theory" of the continental law to judge whether the causation in fact exists between the illegal endorsements and the damages of consumers. On this point, the "material factors theory" of the Anglo-American law also should be considered. While judging whether it has the causation in law between the illegal endorsements and the damages of consumers, it is necessary to insist on the relative causation theory. Moreover, under the chains of the causation, it is essential to observe and study factors of "trust". Some arguments state that it is not suitable to apply the punitive damage to the civil liability for the endorsements. This paper, however, holds that it is neither conformable to the real jurisprudence nor useful to protect consumers'interests and restrain the illegal endorsements if the punitive damage is totally eliminated from the range of the endorsements in advertising. The specific rules that the endorser is liable for the civil liability are as follows:whenever the endorser has intention or gross negligence, he or she should be liable for the joint liability; if the endorser has general negligence, for the limited joint liability that is not more than 10% of the total damages; if the endorser has slight negligence, for no liability. Although some comments argued that the legal foundation of the joint liability is the product liability, this paper, however, holds that it is more reasonable to look it as the advertising liability. Some arguments state that under the chains of the liability the endorser should bear the secondary liability while his paper holds that these arguments could not explain reasonably that the malicious torts through the subjective contacts do exist in the endorsements in advertising. Some arguments state that to investigate the endorser's legal liability should emphasize the priority of public law liability, then the subsidiary of private law liability or even without. However, this paper holds that there is positive connection of the causation upon the liability of damages between the illegal endorsements and the consumer's damages. Other points argued that since the "endorsing scandals" happened repeatedly, the related government departments which are in charge of administrative supervision should be liable for the joint liability as well. These points are worth introspecting for us. And the relationship between false advertisement and false endorsement is often regarded as the same in practice. In fact, it is essential to distinguish the endorser's liability for false endorsements from the advertiser's liability for false advertisements. We should make the really liable person, advertiser, undertake the liability for false advertisements that should not be held by the endorser to revert the nature of the endorser's liability. If an endorser is a spokesperson on behalf of the advertisers'interests and when the endorser is engaged in illegal endorsements and thus infringed the consumers' interests and even the social public interests, the endorser should be prosecuted for the administrative liability for it by the government who has the obligations to be the spokesperson of the consumers. Although in practice the possibility that an endorser's illegal endorsements will be punished through the criminal liability is very little, it is significant to increase deterrence of this kind of criminal regulations.Fourthly, it is concerning the issue to draw lessons from other countries or regions and to improve our legal regulations concerning the endorsements in advertising. The America is one of countries whose legal regulations concerning the endorsements in advertising are the most complete in the world. It drew up the earliest Guides Concerning Use of Endorsements and Testimonials in Advertising whose most typical feature is to fully protect the interests of consumers, which is also the important tendency for the legal system's development of America. Specially, the regulations concerning the definition of the endorsements, the standard of recognizing endorsements, the obligations of authenticity for endorsements and the disclosure of material connection in the endorsements and so on in American law are worth learning for us. As for the injury by the misleading endorsements, the sufferers can acquire legal relieves from equity law, common law and statutory law. It is necessary for us to learn from American dualism doctrine to distinguish the direct participant liability for false advertisements from the liability for false endorsements. Moreover, our Taiwan region also stipulated its own codes of conduct concerning the endorsements in advertising. The codes have typical features of the American law, but in the aspects of the liability for the endorsements the codes express the typical characteristics of the continental law. Its regulations of the liability for the endorsements in advertising are especially worth learning for Mainland region. Compared with the United States and our Taiwan region whose legal regulations are very complete, the main problems of the legal regulations in Mainland region are that the legal system is multifarious and disorderly and the specialized norm is absent; the codes of conduct are sketchy and the necessary guides of conduct are inefficient; the liability system is not complete and so on. Especially speaking, the fundamental defect of our legislations is that the personal endorser's liability for endorsements under the Advertising Law of PRC is absent and it is also unscientific to use the liability for false advertisements as a substitute for the liability for false endorsements. Furthermore, the attitude to the criterion of liability of the civil liability in our legislations is kind of ambiguous. Comparatively, the application of the joint liability for the endorser with the general negligence could be too strict. In addition, our legislators need to pay more attention to the substantial vacancy of administrative liability and criminal liability for the endorsements in advertising. On the legal regulations concerning the endorsements in advertising, we should insist on the value tropism that consumer's rights are prior to the endorser's freedom of conducts, and we should carry out three legal functions at least:remedying right, keeping freedom and balancing benefits. We should distinguish the endorser's liability for false endorsements from the advertiser's liability for false advertisements and refuse the theory that the liability for false endorsements is equal to the liability for false advertisements. Furthermore, we should formulate the personal endorser's liability for the endorsements, make the the criterion of liability clear, apply the distinguished joint liability for the endorsements to different subjective faults, conditionally apply the punitive damages and strictly limit the application of public law liability, especially the criminal liability. As a pressing matter for the moment, a special Codes concerning Endorsements and Testimonials in Advertising should be enacted as soon as possible.In conclusion, regarding our legal regulations concerning the endorsements in advertising, our legislators should learn legislative experience from other countries or regions and complete our legal system on the endorsements in essence and totally improve the legal environment for advertisements for the purpose of the protection of consumer's interests and providing explicit behavior guides for the endorsers in advertising.