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With the rapid growth of the Chinese economy, an increasing number of well-known international brands have set their sights on the PRC. The issue of how to label their products lawfully in the PRC has become pressing for many of them.

¡°Product label¡± is the collective term for indications used to identify products and their quality, quantity, features, characteristics and method of use. It can take the form of text, symbols, numbers, graphics or other form of explanation. A product label can be seen as a product¡¯s business card. It has an advertising function and is an important manifestation of an enterprise¡¯s image.

Chinese regulations governing product labels are numerous and complex. The PRC Product Quality Law and the Marking of Product Labels Provisions set out basic requirements for product labels, and other statutes, rules and regulations set out special provisions for certain key industries. However, to date, there is no specific law or statute addressing product labels that covers all industries.

General principles

The basic provisions concerning product labels can be distilled into the following principles.

First, the contents of a product label must be true, be consistent with the product itself, be simply written, easily understandable and accurate, and may not contain any feudal superstition, information that is unhealthy or that disparages competitors, or information that is false or that may mislead consumers. This principle is particularly clear in such sectors as food, pharmaceuticals, medical apparatus and instruments, and cosmetics. For example, the Food Labelling Administrative Provisions require that food packaging and labels do not explicitly or implicitly state that the food can prevent or cure disease; and the Labelling of Cosmetics Administrative Provisions prohibits cosmetics labels from containing information that explicitly or implicitly claims that the cosmetic has medical benefits.

Second, the content on a label should be clear, and the label itself should be firm, conspicuous, durable and easily distinguishable.

Third, the writing on a label should be in standard Chinese. A foreign language or pinyin may also be used, provided that they are smaller than the corresponding Chinese characters. The Chinese characters, numbers and letters used on a product label may not be less than 1.8 millimetres in height.

Fourth, a label must include the basic information required by laws and regulations, which is mainly as follows:

(1) product name: the product name should indicate the true attributes of the product;

(2) name and address of the producer in Chinese: the name and address of the producer that is liable for the quality of the product should be lawfully registered; imported products may omit the name and address of the original producer, provided that the origin (country or region) of the product and the lawfully registered name and address of the agent, importer or seller in the PRC are indicated;

(3) proof that the product has passed quality inspection;

(4) product standard number: products produced and sold in the PRC are required to indicate the number of the national standard, industry standard, local standard or registered enterprise standard implemented by the enterprise. A product standard number is not required for an imported product sold in the PRC;

(5) production permit mark: for products that are required to have a production permit, the mark and number of the valid production permit should be indicated;

(6) the specifications, grade, quantity and weight of the product, the names and quantities of the main ingredients and other technical requirements;

(7) for products with a limited shelf life, the production date and safe use period or expiry date should be indicated;

(8) warning symbol or warning explanation in Chinese: a product that, if used improperly, could easily result in damage to the product itself or jeopardize human health or the safety of a person or property should carry a warning symbol or a warning explanation in Chinese. The packaging of highly toxic, radioactive, hazardous or fragile products, or products that should not be stacked, should be protected from damp, should not be placed upside down or for which there are other special requirements should comply with legal and contractual requirements, carry a warning symbol or warning explanation in Chinese, and provide instructions for storage and transport.

Certain key industries are subject to regulations that impose special restrictions on product labels. For example, if a certain food has been clinically proven to pose a threat to certain people, or has undergone irradiation, or is genetically modified or contains genetically modified ingredients, this should be indicated in Chinese on its label. On the packaging or labels of baby formula, the fact that breastfeeding is better should be prominently stated. A warning in Chinese that smoking is harmful to health should be placed on the packaging or labels of tobacco products.

Legal risks

All regulations governing product labels specify the administrative and civil liability for any violation. Forms of administrative liability include orders to rectify the matter, orders to halt production or sale, fines, and confiscation of illegal income.

Improper marking of product labels may additionally give rise to civil liability, which is manifested in such laws as the PRC Product Quality Law and the PRC Tort Law. Additionally, the competent authorities will irregularly disclose on official websites or in the mainstream media the results of special inspections, revealing the names of enterprises whose product labels do not make the grade. This can undoubtedly have an adverse impact on the reputation of the product and corporate image of any enterprise whose name is so revealed.

Spring Chang is a co-founder of and partner at Chang Tsi & Partners. Her practice focuses on intellectual property. Wang Yue is an attorney at Chang Tsi & Partners.