Cambodia’s new Sub-Decree on the Management of Commercial Advertising of Products and Services, issued November 4, 2022, is a notable step in ensuring that advertisers comply with advertising regulations, advertise ethically and legally, and avoid deceiving or misleading consumers. The sub-decree regulates both traditional advertising (e.g., print, broadcast, display, etc.) and digital forms (e.g., social media, online, mobile, etc.), and also includes provisions that address advertising alongside rewards—a popular method of advertising in Cambodia.
The Ministry of Commerce is the authority tasked with issuing certificates of advertising compliance (more below) and is responsible for monitoring and assessing the compliance of advertisements with this sub-decree and related regulations. The ministry also enforces against unfair advertising through its Consumer Protection, Competition and Fraud Repression Directorate-General (CCF).
Key Issues
The sub-decree addresses a range of key issues relevant to companies advertising products and services in Cambodia.
Licensing
The sub-decree does not appear to set new licensing or permit requirements, but it requires advertisements for products and services to comply with the sub-decree, any existing regulations (unless they contradict the sub-decree), and future regulations. If regulations require a license for advertising, this should be obtained from the relevant authorities. One example is advertising of pharmaceuticals, which requires a license from the Ministry of Health under existing regulations.
Types of Advertisement
Under the sub-decree, advertising is divided into two types: advertisements with rewards and advertisement without rewards. Rewards may include souvenirs, lucky draws, and other rewards attached to the purchase of products and services.
Forms of Advertisement
Forms and means of advertising specified in the sub-regulation include the following:
- Advertising via audiovisual media such as TV, electronic broadcasting media (including both satellite and cable TV), and so on;
- Electronic advertising, such as websites, e-mail, electronic messages (in written, voice, or image form), ringtones, social networks, computer applications, and advertisements displayed on a phone or other smart device, or other internet-browsing software;
- Print advertising such as newspapers, magazines, and bulletins;
- Advertising via audio broadcasting, including radio broadcasting of any kind;
- Advertising via equipment for storing any kind of audio and video, including CD, VCD, DVD, DVD, 3D/4D/5D movies, videos, or animations, and other cultural programs;
- Advertising via stage performances such as concerts, art, and entertainment;
- Display advertising on LCD screens, billboards, information boards, wallpaper, banners, posters, and other materials;
- Advertising via discount sales, special discount sales, warehouse clearance sales, and fixed-price sales;
- Advertising on the packaging of goods;
- Advertising in a transportation center or on transportation vehicles;
- Advertising in a meeting, workshop, training session, or press conference;
- Advertising via public display of product samples;
- Advertising in educational institutions, sports centers, health institutions, religious institutions, business centers, and entertainment, banking, and industrial establishments; and
- Advertising in public.
The sub-decree further provides that advertisement text includes any words, content, video, animations, or any other idioms intended to advertise products and services. Notably, the definition specifically refers to “any meaning,” e-mails in text or voice, songs and folk songs, poems, chants, comedy, ringtones, short videos, 3D/4D/5D animation, or other idioms intended to advertise the supply of products and services.
Obligations for Advertisements with Rewards
Under the sub-decree, advertisers that use rewards must do the following:
- Confirm the total amount of products that come with the reward;
- Specify the type and amount of each reward and the total amount of rewards;
- Specify the validity of the reward;
- Provide clear information on the location for providing or obtaining a reward;
- Provide documents or information on the identity of winners on a monthly and annual basis (presumably to the authorities).
Certificate of Advertising Compliance
The sub-decree refers to a certificate of advertising compliance, which appears to be voluntary. The sub-decree uses the wording “may apply” when referring to the certificate, but further implementing regulations may clarify this issue. The certificate confirms that the advertisement is in line with Cambodian law.
Under the sub-decree, certificates of advertising compliance can be applied for prior to advertising products or services. The CCF will decide on the application within five working days of receiving the application. The validity of the certificate of advertising compliance may be based on the length of the advertisement, but it will not exceed one year. A certificate of advertising compliance may be renewed 30 days before its expiration date.
Language Requirement
Advertisement of products and services must be in Khmer language, except for (1) trademarks or tradenames that are in a foreign language and cannot be replaced by Khmer language, (2) books, websites, and products published in print that have been approved for publishing in Khmer and English, and (3) radio and television broadcasting in Khmer and foreign languages.
For advertising that includes both Khmer script and that of English (or another language), the Khmer script must be twice the size of the foreign script and should always be placed above the foreign script.
This is a major new requirement, as it requires advertisements to use Khmer language predominantly. This would mean a major shift in the advertising landscape. Advertisers should pay attention closely to see how this new language requirement functions and how broad its scope is. This will be of interest to many, such as streaming services that advertise their content predominantly in English in Cambodia.
Prohibited Content
The following actions are prohibited in advertising:
- Revealing state secrets, endangering national independence, national defense, national security, the economy, international relations, or social security and order;
- Adversely affecting the country’s honor or national dignity, the national flag, a national symbol, the national anthem, religious institutions, the monarchy, national and international organizations, national heroes, leaders, and the country’s or any individual’s reputation;
- Adversely affecting historical values, ethics, culture, customs, national traditions, beliefs, and religion.
- Expressing racism or discrimination based on color, sex, language, beliefs, religion, political tendencies, national origin, social status, resources, or disability;
- Encouraging children to think, act, speak, or behave contrary to custom, tradition, and morality, adversely affecting their health, safety, or natural development;
- Forcing other people to advertise against their will;
- Hiring someone to lie about receiving a reward or benefit from goods and services;
- Using someone else’s content and text without their permission;
- Comparing goods and services with the intention of degrading or affecting the products and services of other individuals;
- Using words such as “best”, “number one”, “superior”, “unparalleled” or words with similar meanings without documents supporting this, and confirmed by relevant authorities;
- Adversely affecting users’ health and safety;
- Violating other relevant provisions in force.
- Advertising products and services that are prohibited by other relevant authorities and affect public safety, traffic safety, and social order.
Additionally, advertisements must not be deceitful, deceptive, or misleading, regardless of the type, form, and means of the advertisement.
Penalties
Individuals who advertise products and services in violation of the provisions of the sub-decree are subject to the following penalties:
- Written warnings;
- Suspension, revocation, or cancellation of advertising license or certificate of compliance of advertising; and
- Suspension, revocation, or cancellation of business registration certificate, license, or business license for service business.
Relevant ministries, institutions, and authorities may take further action against such violations such as halting, removing, and confiscating advertisements.
Conclusion
The sub-decree provides advertisers of goods and services relatively clear guidelines and rules, which is helpful to foster a clear and level playing field among businesses.
With the sub-decree setting out a clear enforcement role for the CCF, we expect active enforcement to start taking place soon, as this authority has been given a substantial budget to raise the bar for consumer protection in Cambodia. We have already seen the CCF actively addressing certain advertisements that promise rewards with their products. The CCF has issued notices highlighting issues, inviting companies to explain their rewards programs, and providing the companies guidance on how to implement a compliant rewards program. Recently, a stern cautionary notice went out from the CCF, warning of enforcement action against companies implementing a noncompliant rewards program.
However, the new sub-decree also raises new concerns and leaves uncertainties, including on its scope of application and how existing laws and regulations tie into the sub-decree. The Khmer language requirement will be an onerous obligation for some businesses, and pushback can be expected. However, we note that most consumer protection-related laws and regulations that have been adopted in the last few years require a shift to Khmer language. We note that labeling laws, consumer information regulations, and now advertisement rules require Khmer language, which is a sensible step to protecting Cambodian consumers and ensuring they can make well-informed decisions when purchasing products and services in Cambodia.
For further information, please contact:
David Mol, Tilleke & Gibbins
david.m@tilleke.com
