Questions arise on netizen compensation

A ruling by China's top cyberspace regulator that Baidu must compensate netizens cheated by promotional advertisements on the search engine triggered heated debate on Tuesday, with questions arising on the feasibility of implementing the ruling.

The company became the target of public criticism after the death of a young man who had received an experimental cancer treatment at a military hospital in Beijing. He had learned of the treatment, which cost more than 200,000 yuan ($31,000), by searching online.

An investigation found that the hospital had illegally outsourced its departments to a for-profit company and published false medical advertisements online.

On Monday, the Cyberspace Administration of China ordered Baidu to abandon its paid listing system-a practice under which search content ranking is based on the price an advertiser pays - and required the company to compensate netizens if they are cheated by false promotions offered on Baidu.

Baidu responded by setting up a fund of 1 billion yuan ($153.4 million) for such compensation and promising to review all of the promotions it offers, according to a company statement.

The company said that in 2013 it had established such a compensation system, under which it has dealt with more than 2,500 cases and paid out a total of 50 million yuan.

Zhu Wei, an associate professor of law at China University of Political Science and Law, said the new order on compensation is in line with the law on consumer rights protection.

He said that after paying consumers, Baidu could in turn ask for compensation from problematic advertisers.

"Information platforms like Baidu benefit from promotions, and compared with netizens, it's easier for such big companies to ask for compensation from advertisers," Zhu said. "That's why the law includes the prepaid compensation stipulation."

Meanwhile, others have voiced concerns about how the rule could be implemented.

Wang Weiwei, a lawyer from Beijing Zhong Wen Law Firm, said it would be very difficult for most netizens to prove they were misled by such advertisements.

"How to collect evidence and what kinds of evidence are effective are both challenges," he said.

Zhang Haoyu, an official at the Chinadolls Center for Rare Disorders, said the new rule might be unrealistic and does not touch upon the fundamental of the problem.

Zhang said that, since January, the Chinadolls Center and a number of other NGOs have reported Baidu to Beijing's Industry and Commerce Bureau for what they believed to be false medical advertisements. But so far, Zhang said, the bureau has not made any ruling because, he said he was told, it was not clear whether the paid listing information in question was actually "online advertisements".