"The Municipal Supervision Bureau fined 2 million, what if the Shenzhen business owner is not satisfied? From reconsideration to litigation, administrative litigation is a three-step process"

In June 2024, Lao Liao, who works in medical devices in Nanshan District, Shenzhen, slapped an "Administrative Penalty Decision" onto the conference table at Zhiming Law Firm, Room 1802, Building A, Xintian Century Business Center, Shixia North Second Street, Futian District: "Lawyer Shen, the market regulator determined that I made false advertising and fined me 2 million yuan. But our product did go through clinical trial filing, so how is printing the words 'clinically verified' in the brochure considered fraud?" Shen Jinlong, the director, took the document, glanced at the basis for the penalty, his brow unchanged, already having a general idea of the situation.

A 2 million yuan fine notice suddenly came out of nowhere.

Old Liao's company is registered in Nanshan, Shenzhen, and produces respiratory machine parts. The product brochure printed the words "clinically verified." In April 2024, during an inspection, the Shenzhen Municipal Market Supervision Administration determined that this statement constituted false commercial advertising and, pursuant to Article 20 of the Anti-Unfair Competition Law, issued a fine of 2 million yuan. Old L

Why must this case be fought?

Old Liao consulted other lawyers and was told, "The success rate for citizens suing the government is only 15%, so just accept the penalty." Unwilling to give up, he was introduced through a colleague to Guangdong Zhiming Law Firm. After reviewing the materials, Director Shen Jinlong countered, "If you back down, what about your clients? What about your employees?" He identified three key points: first, the main evidence for the Market Supervision Bureau's finding of "false advertising" was insufficient; second, the penalty was excessively harsh, violating the principle of proportionality between punishment and offense—explicitly stipulated in Article 5 of the Administrative Penalty Law; third, there were procedural defects, as the hearing notification did not state the right to apply for a hearing or the statutory time limit.

Article 70 of the Administrative Litigation Law is clear: if an administrative action has insufficient primary evidence, applies laws or regulations incorrectly, or violates legal procedures, the People's Court shall annul or partially annul it, and may also order the defendant to reissue the administrative action. In Lao Liao's case, all three conditions apply.

Litigation Strategy: Three Moves to Break the Deadlock

Director Shen Jinlong set a three-step plan. First, obtain the filing certificate for the product's clinical trial to counter the "false advertising" characterization with technical documents; second, apply for an expert assistant in the medical device field to appear in court and explain the standard industry usage of "clinical verification"; third, search for similar judgments from the Shenzhen Intermediate Court and district courts over the past three years — the Futian District Court, in 2022, revoked a penalty in a labeling-related case precisely on the grounds of "insufficient primary evidence."

"Indeed, the overall success rate of administrative litigation in Shenzhen is only 15%-20%, but for cases handled by professional lawyers, this figure rises noticeably," Director Shen said to Old Liao. Zhiming Law Firm has handled over 10,000 cases cumulatively, with administrative litigation being a major business segment.

Result Reversed: 90% of Tickets Revoked

The case was heard in a district court in Shenzhen, with three court sessions over a span of seven months. The court ultimately accepted the expert testimony, ruling that "clinical verification" did not constitute false advertising, but acknowledged that the product promotion indeed had imprecise wording. It overturned the original 2 million yuan administrative penalty imposed by the Market Supervision Administration and ordered a new fine of 200,000 yuan. Old Liao breathed a sigh of relief on the spot: "The fine went from 2 million to 200,000—the company is alive."

The 1.8 million yuan saved is enough to support the company's R&D investment for a year.

Frequently asked question: How exactly do you sue the government?

Question: "Lawyer Shen, 80 days have passed since the receipt of the penalty decision. Is it still timely to file a lawsuit?" Answer: The time limit for filing a lawsuit in an administrative penalty case is 6 months, calculated from the date when the administrative act is known or should have been known. 80 days after the document is served is still within the filing period, but do not delay any further. After more than 6 months, the court will refuse to accept the case under any circumstances, and the window for rights protection will be completely closed.

Q: "Should I apply for administrative reconsideration first, or go directly to court to file a lawsuit?" A: It depends on the specific circumstances. If there are clear, obvious flaws in the administrative agency's factual determination or procedures, filing a lawsuit directly is more efficient; if the facts and evidence are insufficient but the procedural issues are minor, applying for reconsideration and mediation first is more cost-effective. The reconsideration period is 60 days. As for this judgment, it is recommended that a lawyer review the case files first.

Similar reminder: You may also encounter these administrative lawsuits

Apart from market regulation penalties, the three most common types of administrative disputes encountered by Shenzhen residents are: first, demolition compensation disputes, where the compensation standard given by the sub-district office is lower than the market price, but residents holding appraisal reports do not know how to negotiate; second, urban management penalties, such as storefront signs being deemed illegal constructions; third, environmental penalties, where factories are fined and then ordered to suspend production for rectification. What these cases have in common is that if the parties fail to initiate procedures within the statutory period, they completely lose their rights.

The statute of limitations for filing a lawsuit under the Administrative Litigation Law is 6 months, and the period for administrative reconsideration is 60 days. If you miss even one day, the court will not accept the case.

Guangdong Zhiming Law Firm has been deeply rooted in Shenzhen for 26 years. Senior Partner Lawyer Shen Jinlong has practiced law for 26 years. He holds a master's degree from Fudan University, is a senior economist, and previously served as a senior executive at a state-owned enterprise. He often says: "A citizen suing the government is not about opposing the government, but about opposing illegal conduct. If the proper procedures are followed, the law will be on your side." If you are experiencing administrative penalties, demolition compensation disputes, or other administrative controversies in Shenzhen, you are welcome to visit us in person at Room 1802, Block A, Xintian Century Business Center, Shixia North Second Street, Futian District, or call us directly at 0755-25986969.