You Could Really Be Imprisoned on Charges of Helping Your Customers Complain for False Information and Remove Postings

Most businesses especially large ones need to remove negative online information, which in addition to criticisms for their products and services, may also include false information and libel. Businesses need to keep informed of and monitor trends of opinions of the public and often commission public relations agencies to do related activities for them. According to relevant legal interpretations, “paid removal of postings” could be convicted of the crime of doing business illegally. Our lawyer Zhang Qianlin writes a summary of criminal risks and mistakes in “paid removal of postings”.
2019-12-31 15:56:13

A recent criminal case attracted much attention of people in the public relation sector and made the illegal business of paid removal of postings known to the public.  


Background of the case: The head of a public relation agency removed postings for its customers through an agent

In this case the defendant Jiang, president assistant and head of the big data center of the Beijing DIS Public Relations Consulting Co., Ltd. found on the internet Wu and other people who removed postings as a profession and asked them to remove and hide over 1800 postings in order to perform three Baidu search engine optimization contracts between DIS and Amway (China) Commodities Co., Ltd. Jiang paid to Wu over RMB 1,430,000 and DIS paid to Amway over RMB 5,840,000 for removal of the postings.


Court decision: The companies and people involved were all convicted of the crime of doing business illegally.

The court finally decided that DIS, Jiang, Wu and other people all committed the crime of doing business illegally and that DIS should pay a penalty of RMB 4,500,000, Jiang was given a sentence of six years and nine months with a penalty of RMB 4,500,000 and Wu and other people who were additionally charged with the crime of illegal removal of postings were given a sentence of seven to nine years each with a penalty of RMB 2,000,000.  

The case attracted much attention of people in the public relations because most businesses especially large ones want to remove negative online information, which in addition to criticisms for their products and services, may also include false information and libel. Businesses need to keep informed of and monitor trends of opinions of the public and often commission public relations agencies to do related activities for them.  

              

Legal interpretation: Paid removal of postings should be convicted of the crime of doing business illegally and punished accordingly. 

There was no ban on “paid removal of postings” before 2013. The ban on paid removal of postings was included in Article 7 of the Interpretation of Several Issues Connected with Application of Laws to Criminal Cases Such as Libel through Information Networks published by the Supreme People’s Court and the Supreme People’s Procuratorate on 6 September 2013, which added that “paid removal of postings” should be published as the crime of doing business illegally. The full clause is as follows. 

Provision of paid services of removing information for the purpose of making profits by using information networks violating Chinese law or provision of paid services such as dissemination of information with the knowledge that it is falsified, adversely affecting the market order in one of the following circumstances shall be deemed as doing business illegally in a “serious circumstance” which according to the fourth item of Article 225 of the Criminal Law shall be convicted of the crime of doing business illegally and punished accordingly.    

i.An individual obtained illegal turnover of over RMB 50,000 or illegal income of over RMB 20,000; ii. A company obtained illegal turnover of over RMB 150,000 or illegal income of over RMB 50,000.

Doing the above act and reaching five times the above amount shall be found as a “very serious circumstance” under Article 225 of the Criminal Law.

Subject to Article 225 of the Criminal Law, people doing business illegally in a serious circumstance shall be sentenced to less than five years or detained and/or given a penalty of more than one and less than five times illegal income, or in a very serious circumstance, a sentence of more than five years and a penalty of over one and below five times illegal income or confiscation of the criminal’s assets.   

The first circumstance included in Article 7 of the Legal Interpretation 2013 is directly connected with “paid removal of postings”, which is followed by a number of decided criminal cases of paid removal of postings, in some of which public relations agencies like DIS and people held directly accountable for them were given criminal punishment. 

It is six years since the above Legal Interpretation was taken into action, but some companies and people in the public relations haven’t paid adequate attention to it and have made a lot of mistakes.


Mistake A: Removing postings for customers is a normal service provided by public relation agencies.

By law “removal of postings” is a “online information service”. According to the Administrative Regulations of Online Information Services issued by the State Council, as profitable online information services shall be subject to license approval and non-profitable ones subject to recordation, “no person can provide online information services without obtaining the license or completing the recordation formalities”. Public relations agencies are not eligible to be licensed for online information services and will violate the Administrative Regulations of Online Information Services and adversely affect the regulatory order of the online information service order if they provide paid services connected with removal of postings. Therefore, their removal of postings is illegal.


Mistake B: Removal of postings for customers can be done in the name of “search engine optimization services”.

Is “paid removal of postings” a crime? It mainly depends on whether it is “for the purpose of making profits” without respect to the contract name. Removal of postings is a crime of doing business illegally as long as it has really happened and an amount of money that reaches the legal limit is paid for it.

In a case in Shanghai the court found that Bei, the general manager of Shangahi Zeyi Cultural Communication Co., Ltd. was convicted of the crime of doing business illegally and sentenced to five years and six months because he signed a Public Relations Service Agreement and a Marketing Service Contract with one of the company’s clients and provided public relations services connected with online information such as removal of online information, online publication and provision of writings for Baidu Baike with the knowledge that the company had no license for profitable online information services. 


Mistake C: It is rightful for businesses to protect their rights by complaining and removing postings about false information involving the business through an online channel of complaint.

According to the verdict of the DIS case, the court found that criminal punishment should be given for acts as well as services connected with paid removal of postings. Accepting a user’s commission to complain about and demand the website to remove postings involving libel and obtaining profits from the commission is also an act of providing paid services connected with removal of postings.  

Actually, most of online platforms have a complaint channel, through which business or individuals can complain about information on the website that damages their legal interests. Platforms usually adopt the “notice-removal” approach to deal with a complaint after verifying the identity of the complainant. If the damaged party commissions a non-licensed third party to make a complaint and pays a “service fee” for it, the third party’s provision of the “service” is prohibited by criminal law.

In another case the court decided that Yuan and other people remove postings for profits in the following ways. First, they complained by complaint channels published on websites. Second, they got in contact with website editors and offered them money to remove postings. Third, they got other agents to remove postings and make profits from price differences. The court found all the acts were illegal.


Opinion A: The Legal Interpretation 2013 is retrospective.

Note that the above legal interpretation was published and taken into action on 6 September 2013 but applies to acts of removing postings for profits done before its publication.

According to the Provisions on the Time Limits of the Applicability of the Legal Interpretation on Criminal Law, in respect of acts that were done before the Legal Interpretation was taken into action, if there was no relevant legal interpretation when such acts were being done, cases that are not or being dealt with after the Legal Interpretation was carried out should be dealt with according to the Legal Interpretation. In other words, paid removal of postings that was carried out before September 2013 when it was not prohibited by law can be treated as a crime according to the new Legal Interpretation.

It is very unreasonable or even ridiculous. Theoretically, one of the functions of law is predictability, which means people can decide by law whether their acts are legal or not. Therefore, in principle, no law is retrospective, which means a new law does not apply to acts previously done. However, actualities are there.


Opinion B: Removing postings for nominally “free” may not be legally free from liability.

Furthermore, suppose that public relation agencies remove postings for their customers (and are paid according to the public relation contract they actually perform, not the number of postings removed) without explicitly agreeing that “removal of postings” is one of the services under the public relation contract, consulting contract or other similar contract between them. Is this act “for the purpose of making profits”? Should this “free” removal of postings be published as a crime?

In this case public relation agencies do not make profits for the removal of postings, but could they include such profits in other legal service fee? There is currently no similar case or definite provision. The phrase “for the purpose of making profits” may be interpreted in different ways without necessarily connecting “profits” with “number of postings removed”. In my personal opinion the risk is high.