ESWN reports that nude chat rooms are not illegal in China - so long as it’s not for profit and the chatters avoid organizing politically,:

The 43-year-old male named Chai is a temporary worker at a certain Beijing unit and his job duty is to maintain computers.  Usually, Chai’s favorite hobby is to do Internet chat.  At the end of July this year, a certain male netizen named Dada whom Chai enjoys chatting with suddenly told him one day: "Let me take you a good place — audio-visual chat!"  So Chai followed the instructions and arrived at the chat room known as "Young women" at 263.com’s EConversation audio-visual chat section.

To Chai’s surprise, this was a ‘nude chat room.’  There were males and females inside.  Including Chai, there were five men and one woman, with a married couple.  Within the chat room, everybody chatted in the nude.  The couple even engaged in some sexual activity.  Those who enter this chat room must be "good Internet friends" who have received the secret code from "good acquaintances."  Very soon, Chai was immersed in it.

On August 9, the Beijing City Internet Monitoring Department went through 263.com and saw that there were five men and one women engaged in pornographic shows in the Young women chat room.  Upon investigation, they were able to find Chai.  Chai admitted that he did it, and the Public Security Bureau then asked the Dongcheng Procuratorate to approve the arrest of Chai for the crime of "disseminating pornographic materials."

According to Zhao Gehua, in September 2004, the Supreme People’s Court and the Supreme People’s Procuratorate issued a judicial explanation concerning pornographic activities on the Internet: "The judicial explanation was that the punishment for the distribution of pornographic materials shall depend the numbers for hits, pictures and words on the web site.  But there is no clear requirement for an audio-visual pornographic crime such as ‘nude chat.’  So this is going to make it difficult to specify the crime."

…

Prosecutor Han Xiaorong said: "Concerning pornographic performances, the punishment is usually for the crime of organizing.  But organizing pornographic performances usually mean presenting a performance to an audience at a certain locale.  This does not fit the situation of this case.  Besides, Chai was not the organizer."

According to China University of Politics and Law criminal law professor Pei Guangchuan, it is not correct to characterize this as a "crime of disseminating pornographic materials" because "the body does not equate materials."  "For now, the law is blank insofar as any clear requirements for ‘nude chat’ are concerned.  I would recommend the relevant departments to organize expert scholars to study it in terms of criminality or public opinion."

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