The Advertising Standards Authority of South Africa (“ASA”) is an independent body set up and paid for by the marketing communication industry to ensure that its system of self-regulation works in the public interest. The ASA’s Code of Practice (the “Code”) binds the advertiser, the advertising practitioner and the medium of the advertiser’s message.
All advertising on electronic broadcast media is subject to the Electronic Communications Act 36 of 2005 (“ECA”). Electronic broadcasting in terms of the ECA means any form of unidirectional electronic communications intended for reception by the public, sections of the public, or subscribers to any broadcasting service.
Section 3.11 of the Regulations in respect of the Code of Conduct for Electronic Communications and Electronic Communications Network Services Licensees (issued under the ECA) prescribes the general standards to be adhered to by electronic communications services licensees and electronic communications network services licensees. One of the standards is that advertising by electronic communications services licensees and electronic communications network services licensees must comply with the Code and any other applicable codes that may be developed for the electronic communications sector.
Appendix A to the Code applies (in addition to all regulatory requirements that already exist in South Africa) to the advertising of alcohol. It provides guidance for the advertising of alcoholic beverages in all media (including all digital channels). Specific reference is made to television, radio, cinema, print, billboard and advertorials, where the Code unequivocally binds the advertiser, the advertising practitioner and the medium involved in the publication of the advertiser’s message to the public. The advertising of alcohol over the internet is not, however, addressed as a separate category and this makes it difficult to ascertain which party is responsible for compliance with the Code; ie, the distributor, the advertiser or the online classifieds platform.
An online classifieds platform that may publish advertisements by manufacturers or distributors of alcohol as part of its business is neither an electronic communications services licensee nor an electronic communications network services licensee. There is no doubt that it does, however, make use of the network and services of licensed operators. It is likely that in the agreement between an online classifieds platform and, for example, its ISP, there may be certain provisions dealing with the display of alcohol-related content.
The Liquor Act 59 of 2003 requires manufacturers, distributors and retailers of alcohol to have a liquor licence for the sale of alcohol. The Act does not, however, regulate the online distribution or sale of alcohol. An online classifieds platform, by definition, does not qualify as a manufacturer, distributor or retail seller, because it is not in the business of handling, storing or delivering any liquor. To the contrary, it merely provides a platform for the advertising of liquor. The provision of a platform for the advertising and onward sale of alcohol amounts to an online listing and this, in our view, does not constitute a sale under the Liquor Act. An online classifieds platform is therefore not required to have a liquor licence in order to make its platform available to advertisers for the purpose of the marketing and on-selling of alcohol products.
In other jurisdictions, such as Australia and the United Kingdom, it is common practice for online distributors; that is, retailers who sell alcohol over the internet, to display their liquor licence number online and to provide an age restriction notice; ie, that no alcohol may be sold to persons under the age of 18.
Because online classifieds platforms are likely to be subject to the terms and conditions of their licensed operators and/or because they may be ASA members, they should, as a matter of good practice, give effect to the guidelines in the Code, and require their advertisers to implement the international best practice measures as set out above. This can be done vis-à-vis advertisers by including such terms in their advertising insert orders.
As an aside, the Control of Marketing of Alcoholic Beverages Bill (the “Bill”) was approved by Cabinet in 2013 to be gazetted for public comment. The Bill intended to place an outright ban on the advertising of alcohol, however government has stalled and has, to date, not embarked on the further implementation of the Bill.
This reluctance and delay to take further steps to implement the Bill could be explained by the ANC’s National General Council meeting that was held in October 2015, which called for the regulation of alcohol advertising (as opposed to the banning thereof), by imposing a 2% levy on alcohol brand endorsements.
The intended outright ban on alcohol advertising is, in our view, unlikely to be implemented as initially intended. Instead, the Bill will, in all likelihood, translate into a commercial levy on the distributors and advertisers of alcohol.