Hefei company faces probe for allegedly misleading consumers in mooncake sales

Authorities in the High-Tech Zone of Hefei, Anhui province, have launched an investigation into a company accused of misleading consumers during live-stream sales of a brand of mooncakes, according to a Tuesday announcement from the local market regulation department. The case will be handled based on the findings of the investigation and relevant regulations.

The mooncakes in question, branded as "Hong Kong Meicheng Mooncakes," were sold in live-stream sessions hosted by influencers affiliated with Sanzhiyang Network Technology, a Hefei-registered company. Three packages of the mooncake were sold at 169 yuan ($23.8).

The brand has sparked controversy after several agents and netizens noted that while the name suggests a Hong Kong origin, no physical stores were found in Hong Kong. Furthermore, the mooncakes' packaging indicated that they were produced in Guangzhou and Foshan, Guangdong province.

Many consumers raised concerns about potential false advertising, claiming their refund requests were denied. Meicheng Mooncakes' customer service responded that "mooncakes are seasonal and special food items" and are therefore not eligible for the 7-day no-reason return or exchange policy.

The packaging of the mooncakes lists "Hong Kong Meicheng Food Group Co" as the manufacturer, while the operator is Guangzhou Meicheng Food Co, a company established in April 2019 with a registered capital of 10 million yuan, according to corporate information provider Tianyancha.

On Sept 14, Meicheng Mooncakes' customer service explained that the brand is registered in Hong Kong and holds a trademark certificate. They also stated that the brand's research and development team is based in Hong Kong. However, by that evening, live-stream sales of the product had stopped, and major e-commerce platforms like Tmall and JD had removed the mooncakes from their listings.

A representative from Meicheng Mooncakes expressed frustration, noting that no laws prevent a Hong Kong-registered brand from manufacturing in Chinese mainland.

Separately, the market regulation department of Huadu district, Guangzhou, announced on Sept 15 that it had initiated its own investigation into Guangzhou Meicheng Food Co. in response to public concerns. The company provided commercial registration information for Hong Kong Meicheng Food Group Co and trademark registration documents for "MEISUN", "Meicheng", and "Hong Kong Meicheng Mooncakes". Cross-regional coordination among local regulatory authorities will be necessary due to the scope of the investigation.

Several clips from live-streams show hosts promoting the mooncakes using phrases such as "Hong Kong Meicheng", "big brand", "high-end brand", and claiming they would cost over 200 yuan offline in Hong Kong.

Wen Xiaofeng, a lawyer at Guangdong Bingjia Law Firm, said whether false advertising occurred depends on whether the live-stream hosts emphasized the mooncakes' Hong Kong origin and whether consumers believed they were purchasing a product made in Hong Kong. If consumers were led to believe the product was produced in Hong Kong, it could constitute false advertising, he noted.

The practice of "overseas trademark registration with domestic production" is common in branding, Wen added. Whether this constitutes fraud depends on whether the marketing aligns with the actual origin of the product.