The Management of Commercial Advertising on Goods and/or Services (Jul, 2023)

1. OVERVIEW

a. The Promulgation of the Sub-Decree and Prakas

On the 4th November 2022, the Royal Government of Cambodia (the “Royal Government”) issued Sub-Decree No. 232 on the Management of Commercial Advertising on Goods and/or Services (“Sub-Decree 232”). The Sub-Decree sets out the mechanisms, formalities, and procedures for the management of commercial advertising on goods and/or services. Its purpose is to protect consumers and to promote fair competition.

Subsequently, the Ministry of Commerce (“MOC”) has promulgated, on 16 November 2022,Prakas 249 on Formalities and Procedures for Applying for a Compliance Certificate of Commercial Text and Spot Advertising (“Prakas 249”), setting out the formalities and procedures to apply for the compliance certificate for commercial text and sport advertisement on goods and/ or services in all forms and by any means, including digital means.

b. The Promulgation of Related Laws
The Sub-Decree aims to supplement two existing laws – the Law on Consumer Protection, dated 2nd November 2019 (“Law on Consumer Protection”), and the Law on the Quality Management of Goods and/or Services, dated 21st June 2000, (“Law on Quality Management”).

Under the Law on Consumer Protection, consumer rights are protected as the right to receive information and education for balancing the difference between goods or services and to be protected against fraud and misrepresentation by advertisements. Accordingly, any person who conducts a business shall not engage in any dishonest act. It is therefore prohibited for a person in a business to act in a way which may mislead or deceive consumers. This also includes false or misleading representations through advertisements.

The law also regulates bait advertising and provides that any person who advertises for the supply of goods or services at a particular price shall supply such goods or services at the advertised price within a specified period and in a reasonable quantity.

Under the Law on the Management of Goods and/or Services, the use of language, description, and presentations of commercial advertisements are also regulated to avoid any confusion.

2. COMPETENT AUTHORITY

The Consumer Protection Competition and Fraud Repression Directorate-General (“CCF”) is the competent authority responsible for issuing the compliance certificate of commercial advertising script or spot, under the MOC. Thus, the MOC has the authority to monitor and evaluate the compliance of advertising and to take action against the fraudulent advertising of goods and/or services.

The CCF has already taken legal action against advertisers or individuals whose advertisements do not comply with laws and regulations.

3. SCOPE OF APPLICATION

Commercial Advertising refers to public advertising or advertising to any group of the public, in any form and by any means, to promote the supply of goods or services or the sale or granting of real rights on real estate.

The scope of application is widely defined by the provisions and applies to the advertisement of goods and/or services in all forms and by all means, including digital means.

1. Audio-visual media: TV and electronic medias, satellite TV, cable TV, and satellite dish.
2. Electronic systems: websites, emails, voice/images, ringtones, social networks, applications on computers, mobile phones, or other smart devices, and internet explorer programs.
3. Printing: Newspapers, magazines, newsletters, information cards.
4. Audio broadcasting: audio broadcasting of all kinds.
5. Audio and image storage: CDs, VCDs, DVD-VR, movies, videos, animations, 3D, 4D, 5D, and other cultural shows.
6. Stage performance: concert, art, entertainment show.
7. Display includes LED screens, AFIS, billboards, dashboards, posters, banners, flyers, brand labels, and other postings.
8. Flyers for Goods and/or services.
9. Discount sales, special discount sales, clearance sales, and sales at a fixed price.
10. Packaging of Goods.
11. In transportation centers and means of transportation.
12. In the meeting, workshop, training, and press conference.
13. Public display of product sample images.
14. In educational institutions, sports centers, health institutions, religious institutions, business centers, entertainment centers, banking institutions, and industrial institutions.
15. Public places.

The Sub-Decree also specifies that an advertising text refers to words, content, meaning, e-mail in text or voice, song, poem, chant, chapei, ayai, comedy, ringtone, short video, 3D 4D 5D animation, or other idioms intended to advertise the supply of goods and/or services.

4. DIFFERENT TYPES OF ADVERTISING

Commercial advertising is divided into two categories: advertising without a prize and advertising with a prize. Different from advertising without a prize, the person applying for advertising with a prize is obliged to comply with the additional following requirements: (1) to confirm the total volume of goods with the prize, (2) to specify the type of prize and the total amount of prize, (3) to specify the validity of a provision of a prize, (4) to provide specific locations to provide the prize, and (5) to provide documents or information on the identities of the winner on a monthly and annual basis.

The person applying for advertising with a prize shall make it easy for the winner to receive the actual prize.

5. LEGAL REQUIREMENTS FOR ADVERTISEMENTS (EITHER WITH OR WITHOUT A PRIZE)

a. Legal requirements for the license – mandatory
Any person applying for advertising goods and/or services shall apply for an advertising license. It is prohibited to advertise without an advertising license from the relevant ministries, institutions, and competent authorities.

b. Application for a compliance certificate – voluntary basis
The person can voluntarily apply for a compliance certificate for an advertisement to ascertain that the advertisement does not violate any third party’s rights or Cambodian regulations that are in force. The compliance certificate is also regulated by the Sub-Decree and the Prakas.

Given that applying for the compliance certificate is done on a voluntary basis, the concerned persons who conduct their advertisements without the compliance certificate may be at risk of punishment pursuant to Article 19, 20 and 21 of Sub-Decree 232 if said advertisements do not conform to the Law on Consumer Protection and other applicable laws.

To avoid any risk of penalty, it is recommended that the concerned persons apply for the compliance certification prior to conducting their advertisement.

Who can apply for a compliance certificate?Persons (either natural or legal entity) applying for commercial advertising on goods and/or services may apply for a compliance certificate of commercial advertising on goods and/or services before the advertising process.

The compliance certificate of commercial advertising refers to the certificate issued by the CCF to provide to the person applying for advertising to certify the accuracy of the text or scheme of the advertising or advertising spot. The MOC shall decide on the application for a compliance certificate of commercial advertising within five (05) working days from the date of receiving the application.

What documents are required? When applying for a certificate, one copy of each of the following documents is required: the application form, the commercial registration certificate (company registration, trademark registration), the sectoral business license, the certificate of conformity of goods and/or services (GHP GMP HACCP ISO FSC), the copy of the last year’s patent/value added tax (VAT) for business related to self-declaration regime, receipt of the service fee, ID card, passport or equivalent letter, visa, registration, letter of attorney if necessary, etc.

For the commercial advertising audio or video, the applicant may attach an audio recording such as CD, or a virtual recording such as VCD or USB, according to Prakas.

What are the official fees? The person applying for a compliance certificate shall pay a fee based on the number of scripts or spots and the validity of the advertisement. The official fee for the issuance of a Compliance Certificates is determined by Inter-Ministerial Prakas No. 167 on Providing Compliance Certificate of Commercial Advertisement on Goods and Services, dated 29 March 2023 by the Ministry of Economy and Finance “MEF” in cooperation with the Ministry of Commerce “MOC”.

The below table indicates the official fees, maximum timeframe and validity in accordance with each type of public services:

6. LANGUAGE REQUIREMENT

Advertising text and form shall be expressed in Khmer language and letters. This is to ensure the strengthening of the protection of Cambodian consumers.

However, there are exceptions. The first exception is related to the Marks or Tradenames available in a foreign language or foreign letters that cannot be substituted by Khmer language and letters.

The second exception is related to books, websites, print media, radio, and television broadcasts which are permitted to be published in Khmer and foreign languages. For advertising containing both Khmer and foreign languages, the Khmer font shall be twice the size of the foreign font and the foreign font shall always be placed below the Khmer font.