Google bans payday loan adverts

Google has announced that it will ban all paid-for adverts for loans where repayment is due within 60 days of the date of issue and, in the US, all adverts for loans with an APR of 36% or higher. The policy is one of the first to ban an entire category of financial products and takes effect from 13 July 2016.

Google commented that the change is "designed to protect our users from deceptive or harmful financial products and will not affect companies offering loans such as Mortgages, Car Loans, Student Loans, Commercial loans, Revolving Lines of Credit (e.g. Credit Cards)".

Click here for more information.

New Pricing Practices Guide (PPG) expected shortly

A revised PPG was issued for consultation by the Chartered Trading Standards Institute (CTSI) at the end of 2015.  This draft moved the scope of regulation from a prescriptive to a principles based approach and renewed the focus on fair trading.  The revised PPG should offer businesses more flexibility in the promotion of prices and discounts.  CTSI has informed us that it is awaiting for the European Commission to publish further guidance on the Unfair Commercial Practices Directive before it issues the final form PPG. We therefore expect the revised PPG to be published during the start of the next quarter. 

Changes in advertising broadband services

The Advertising Standards Authority (ASA) is taking a tougher stance on the advertising of fixed broadband price claims to prevent consumers being misled. Research conducted by the ASA earlier this year concluded that consumers do not understand the full picture when it comes to the actual cost of broadband services. Elements of the price such as line rental, contract length and one-off sign up costs are often presented separately and with varying prominence.

From 31 October 2016, all broadband adverts should:

  • show all-inclusive upfront and monthly costs; line rental costs should not be separated out;
  • give greater prominence to the contract length and any post-discount pricing; and
  • give greater prominence to upfront costs.

Click here for more information.

Public consultation on advertising unhealthy foods to children

The Committee of Advertising Practice (CAP) has launched a public consultation into its proposals to introduce new rules restricting the promotion of foods which are high in fat, salt and sugar to children. The proposals include:

  • introducing new rules to the CAP Code to restrict where non-broadcast adverts for unhealthy foods can be placed;
  • considering new rules to prevent advertising unhealthy foods to children under 12 or under 16; and
  • changing the rules so that the prohibition on using characters or celebrities popular with children applies only to adverts for unhealthy foods.

The consultation is driven by the recent wider societal concerns around childhood obesity.

The consultation closes at 5pm on 22 July 2016.

Click here for more information and for details on how to participate in this consultation.

Gender stereotyping in adverts

The increased political and public debate on equality and gender stereotypes has led to greater scrutiny regarding how gender roles are portrayed in adverts. In response, the ASA will be (i) examining evidence on gender stereotyping in adverts (ii) seeking views from a range of stakeholders, and (iii) commissioning its own research into public opinion on this topic. The results will help the ASA to assess whether any changes are needed to address gender stereotyping in adverts. 

Click here for more information and for details on how to participate in this review.

ASA ruling on Asda Choco Squares

An online sales promotion for Asda stated that the Asda Choco Squares are 3 for £3, with the price for one box being £1.38. The complainant understood the product was priced at 97p per box prior to the promotion and challenged whether the advert was misleading.

The 2015 "Pricing Practices in the Groceries Market" report published by the Competition and Markets Authority (CMA) states that where a volume promotion presents a particular saving to the consumer based on the purchase of multiple items, the consumer will take the price of an individual item as a benchmark for any saving. If the price of the individual item is artificially inflated, this could mislead the consumer as to the genuine price of the product in question. Such approach is in line with that taken in the PPG.

The ASA agreed with the CMA and said that since the product had been priced at 97p for around six months and was increased to £1.38 one day before the promotion, the usual selling price was 97p rather than £1.38 as the advert suggested. The ASA therefore concluded that the implied saving of the advert was misleading.

Click here for more information.