Legislation and regulation
What are the principal statutes regulating advertising generally?
In the UK, the two principal pieces of legislation regulating advertising are the Consumer Protection from Unfair Trading Regulations 2008 (SI 2008/1277) (CPUTs) and the Business Protection from Misleading Marketing Regulations 2008 (SI 2008/1276) (BPRs). Both pieces of legislation are derived from EU law and much of the CPUTs and BPRs are also covered in the industry codes (see question 5).
Which bodies are primarily responsible for issuing advertising regulations and enforcing rules on advertising? How is the issue of concurrent jurisdiction among regulators with responsibility for advertising handled?
The Committee of Advertising Practice (CAP) is a self-regulatory body that is responsible for issuing new advertising rules. These rules are then enforced by the Advertising Standards Authority (ASA), its sister body. If an advertiser repeatedly breaches advertising rules or the breach is particularly serious, the ASA may refer the case on to Trading Standards or the Office of Communications (Ofcom). These bodies act as the ASA’s ‘legal backstop’.
Trading Standards is primarily responsible for breaches of the CPUTs and BPRs. In addition, Ofcom has a statutory duty to control radio and television advertising. The UK Competition and Markets Authority (CMA) may also play a part in enforcing the CPUTs where there is evidence of market-wide practices.
There are also a number of industry-specific bodies that regulate the advertising of specific products, for example, the Financial Conduct Authority (FCA) (financial services), the Medicines and Healthcare Products Regulatory Agency (medicines), the Proprietary Association of Great Britain (over-the-counter medicines) and the Association of British Healthcare Industries (advertising of medical devices). The Information Commissioner’s Office is responsible for data protection breaches including in relation to direct marketing.
What powers do the regulators have?
The ASA has the power to investigate breaches of the advertising codes but does not have the power to impose financial penalties (see question 5 for further details). In relation to the CPUTs and BPRs, Trading Standards has the power to carry out inspections. They can seek informal assurances from a trader or commence proceedings that can lead to a criminal conviction and unlimited fines. Ofcom has the power to investigate broadcasters and suspend their broadcasting licences.
What are the current major concerns of regulators?
CAP has introduced new rules to tackle offensive gender stereotyping. As of 14 June 2019, any advertising featuring gender stereotypes that are likely to cause harm or serious or widespread offence is prohibited. Gambling advertising continues to be an area of concern. As well as introducing new tougher standards to tackle the appeal of such advertising to problem gamblers, there have been a number of rulings by the ASA against gambling adverts this year including as to whether a number of gambling adverts were likely to appeal to children owing to the use of animated, cartoon-like graphics. The ASA and CAP have also focused on the practices of secondary ticketing websites in the UK. Following a formal investigation, a number of ticketing sites were obliged to make changes so that pricing information is transparent and not misleading. There has been a similar clampdown in relation to ensuring that online retailers display information on delivery charges more clearly.
Give brief details of any issued industry codes of practice. What are the consequences for non-compliance?
The two principal industry codes of practice (issued by CAP) are the UK Code of Non-broadcast Advertising, Sales Promotion and Direct Marketing (the CAP Code) and the UK Code of Broadcast Advertising (the BCAP Code). All the main trade and professional bodies representing advertisers, agencies, service suppliers and media owners are members of CAP and they agree not to accept any advertising that contravenes the codes.
The CAP Code has a broad remit and applies to print advertising, posters and promotional media in public places, cinema and video commercials and non-broadcast electronic and online media (including social media), sales promotions, advertorials, other promotions (eg, competitions) and a number of other marketing communications. The BCAP Code regulates television (including on-demand television) and radio advertising.
The advertising codes are enforced by the ASA. Anyone may lodge complaints with the ASA, although commercial competitors must first correspond with the advertiser to try to resolve their complaint before approaching the ASA. The ASA can also decide to investigate an advert on its own initiative. If an advertisement is found to breach the advertising codes, the ASA will ask the advertiser to withdraw or change it. A large number of cases are resolved informally but where there is a formal investigation, the ASA’s ruling is published online (leading to potential adverse publicity).
The ASA has a number of other sanctions that it can use to ensure compliance. This includes issuing alerts to CAP’s members to request that they withdraw an advertiser’s access to services such as advertising space, pre-vetting all advertising prior to publication or broadcast and requesting CAP’s members to withdraw an advertiser’s privileges and online sanctions (eg, asking websites to remove paid-for search advertising).
If an advertiser is repeatedly in breach of the codes or there is a particularly serious breach, the ASA may refer the advertiser to either Trading Standards or Ofcom (one of its legal backstops). These bodies can impose fines or seek an injunction in court. Ofcom can also withdraw a broadcaster’s licence to broadcast.
Ofcom has also published a Broadcasting Code that covers some advertising-related issues, such as product placement and sponsorship.
Must advertisers register or obtain a licence?
Advertisers do not generally require a licence. However, broadcasters require a licence to broadcast and broadcasters are obliged by a condition of their broadcast licence to enforce ASA rulings. In addition, there are industry-specific licences (eg, for financial promotions or advertising of medicines).
May advertisers seek advisory opinions from the regulator? Must certain advertising receive clearance before publication or broadcast?
CAP does provide a useful copy advice service but the ASA is not bound by the advice that is given by CAP. Generally, there is no requirement for non-broadcast advertising to obtain clearance before publication. All television advertising is pre-vetted by Clearcast and advertising messages on radio networks are pre-vetted by Radiocentre, but again the ASA is not bound by such clearance.
Private enforcement (litigation and administrative procedures)
Challenging competitors advertising
What avenues are available for competitors to challenge advertising? What are the advantages and disadvantages of the different avenues for challenging competitors’ advertising?
Competitors normally challenge advertising through the ASA rather than by commencing court proceedings. This is faster and more cost-effective and the ASA’s sanctions are commercially effective. The disadvantages are that the competitor must first attempt to resolve the issue with the advertiser before they can formally lodge a complaint. Further, the ASA does not have any legal powers, cannot impose financial penalties and no costs can be recovered for lodging a complaint.
Competitors may also be able to challenge advertisers in court on the basis of trademark infringement, passing off (misrepresentation of goodwill), defamation or malicious falsehood but legal proceedings are expensive and slow and courts have expressed reluctance to get involved in regulating advertising.
How may members of the public or consumer associations challenge advertising? Who has standing to bring a civil action or start a regulatory proceeding? On what grounds?
Members of the public or consumer associations normally challenge advertising by making an ASA complaint for breach of the advertising codes. Members of the public may also bring civil or criminal legal proceedings against an advertiser if they commit an unfair commercial practice in breach of the CPUTs (businesses do not have this same direct right to redress under the BPRs). Although consumer associations cannot initiate legal proceedings, they can complain to the CMA about a particularly widespread market practice.
Burden of proof
Which party bears the burden of proof?
The complainant needs to demonstrate an apparent breach of the advertising codes in an ASA complaint. The ASA will contact the relevant advertiser who will then be required to submit proof to the contrary. In legal proceedings, the claimant will bear the burden of proof.
What remedies may the courts or other adjudicators grant?
For ASA remedies, see question 5. Courts can award injunctions, interim injunctions, damages or an account of profits.
Length of proceedings
How long do proceedings normally take from start to conclusion?
The ASA normally takes about two to three months to provide a ruling, but difficult cases can take considerably longer. In relation to court proceedings, it may take a few weeks to obtain an interim (temporary) injunction to prevent the dissemination of the advertising. However, full trials can last a number of years.
Cost of proceedings
How much do such proceedings typically cost? Are costs and legal fees recoverable?
Costs are not recoverable for ASA complaints and the costs of making a complaint will depend on how much external legal input a complainant will want to include. Costs for legal proceedings are substantially higher, normally thousands, if not tens of thousands, of pounds. The successful party will usually recover some costs but courts will ensure that any cost recovery is proportionate.
What appeals are available from the decision of a court or other adjudicating body?
An ASA ruling can be reviewed by an independent review process if there is evidence to suggest that there has been a substantial flaw in the process or ruling or there is additional evidence. A party has 21 days to request a review following notification of the ASA’s decision. If the independent review finds in favour of the appellant, the matter is then referred back to the ASA for reconsideration.
Court cases can be appealed all the way up to the Supreme Court and certain points of law may be referred to the European Court of Justice.
Editorial and advertising
How is editorial content differentiated from advertising?
Editorial content is outside the ASA’s remit and the advertising codes state that any advertising must be identifiable as such. In particular, advertisers should ensure that advertisements are designed and presented in such a way that they can easily be distinguished from editorial content. In particular, advertisers should also make clear that advertorials are advertising content.
The ASA and CAP continue to monitor use of advertorials and ‘native advertising’. There has also been recent CAP and ASA guidance on making advertisements clear on social media, in particular where social media influencers are used. In such circumstances, the ASA considers whether the content is controlled by the advertiser (rather than the publisher) and whether it is disseminated in exchange for payment or another reciprocal arrangement.
Advertising that requires substantiation
How does your law distinguish between ‘puffery’ and advertising claims that require support?
Puffery (defined by the advertising codes as ‘obvious exaggerations’) and claims that the average consumer is unlikely to take literally are allowed and require no substantiation provided that they are not materially misleading.
The ASA has previously ruled that ‘younger looking skin’ (to advertise collagen) would not be perceived as puffery as this is an objective statement. However, ‘the most comfortable beds in the world’ was considered to be puffery because consumers’ experiences of comfort of mattress types would vary and be based on their individual needs.
Rules on misleading advertising
What are the general rules regarding misleading advertising? Must all material information be disclosed? Are disclaimers and footnotes permissible?
The general rules under the advertising codes are that advertising must not:
- materially mislead or be likely to do so;
- mislead by omitting material information or presenting it in an unclear, unintelligible, ambiguous or untimely manner; or
- imply that expressions of opinion are objective claims.
‘Material information’ is defined as information that the consumer needs to make informed decisions in relation to a product (eg, the main characteristics of the product, the advertiser’s identity and address, the product price including all taxes and delivery charges, any unusual payment, delivery or performance arrangements and that consumers have a right to withdraw from or cancel the purchase).
In addition, under the CPUTs, a number of misleading commercial practices are prohibited. It is a criminal offence to make false and misleading statements or omissions including about the existence of a product, the main characteristics of a product and the price. Omissions are considered to be ‘misleading’ if taking into account the circumstances of the commercial practice and the medium used to communicate it, it omits, hides, disguises or delays material information so as to cause the average consumer to take a transactional decision that they would not otherwise have made.
Disclaimers and footnotes are permitted in order to further explain or qualify any headline advertising claims. However, advertisers should be careful to ensure that they only clarify and do not contradict those claims. In addition, CAP has introduced new standards for on-screen text on television which requires that:
- qualifying information is presented clearly;
- text in conventional television advertising is kept to a minimum;
- text is in lower case with upper case used only where normal for punctuation and in words or abbreviations commonly capitalised;
- text is held for a duration calculated at the rate of five words per second (ie, 0.2 seconds per word). Where the text concerned contains 10 words or more, an additional ‘recognition period’ of three seconds must be added, or two seconds if the text contains nine words or less; and
- all graphics and text be framed within the 16:9 caption safe area.
The guidance sets out additional factors that are important for achieving legible and comprehensible text.
Substantiating advertising claims
Must an advertiser have proof of the claims it makes in advertising before publishing? Are there recognised standards for the type of proof necessary to substantiate claims?
Advertisers must be able to substantiate any objective claims and hold documentary evidence before publication to prove claims that consumers are likely to regard as objective. Without such evidence, the ASA will consider such advertising to be misleading. Advertisers may provide genuine customer testimonials in their advertising but these alone are unlikely to be considered sufficient to substantiate objective claims.
In relation to medical and scientific claims about health and beauty products (including slimming products, food supplements and cosmetics), evidence used to substantiate should generally consist of trials conducted on human subjects.
Are there specific requirements for advertising claims based on the results of surveys?
CAP has provided the following guidance:
- universal claims (ie, people prefer product A) will be difficult to make unless there is robust data heavily in favour of a positive result (the ASA has previously ruled that an 83 per cent positive response was not sufficient to support this type of claim);
- it is not a requirement to state sample sizes in advertising. However, where the sample size is unlikely to be big enough to substantiate a headline claim, then it is advisable to include qualifying text that gives the sample size;
- where consumers are given an incentive to participate in a survey (eg, sample products and a chance to win a large prize), this may undermine the impartiality of the participants; and
- when making claims based on extrapolated conclusions (eg, 80 per cent of British consumers prefer Flora, based on 500 British consumers), the advertising should make it clear that this is the basis of the claim to ensure that the advertising does not mislead by exaggeration.
In addition, the ASA has previously provided some guidance on what survey information should be provided when making a comparative claim. The ASA has advised that advertisers should provide information on the following:
- the methodology of the survey;
- the group of respondents represented in the survey sample;
- which competitors had been included in the comparison; and
- any factors that the respondents were required to consider when answering the question on which the claim was based.
Comparisons with competitors
What are the rules for comparisons with competitors? Is it permissible to identify a competitor by name?
Comparative advertising is regulated by the BPRs. Advertisers are permitted to identify a competitor by name, product or a trademark (implicitly or explicitly) provided that the comparative advertising:
- is not misleading;
- compares products meeting the same needs or intended for the same purpose;
- objectively compares one or more material, or relevant, verifiable and representative features of those products (including price);
- does not create confusion between the advertiser and their competitor (or their trademarks or products);
- does not discredit or denigrate the competitor’s trademark, name, product or activities;
- does not take unfair advantage of the competitor’s trademark, name or product; and
- does not present products as imitations or replicas of products bearing a protected trademark or name.
Test and study results
Do claims suggesting tests and studies prove a product’s superiority require higher or special degrees or types of proof?
There is no requirement to provide a higher or special degree or type of proof in superiority claims. However, advertisers must follow the general rules to ensure any such claims are objectively accurate and can be substantiated.
Are there special rules for advertising depicting or demonstrating product performance?
Advertising must not exaggerate the capability or performance of a product or service, for example, in visual representations (eg, depicting a surface cleaner easily removing difficult dirt) or in before and after photos. Advertisers are required to hold signed and dated proof that the photos are genuine and have not been manipulated. The photos should not exaggerate the efficacy of the product and advertisers need to ensure that they have relevant evidence to substantiate the impression created by the images.
Are there special rules for endorsements or testimonials by third parties, including statements of opinions, belief or experience?
Under the advertising codes (Rules 3.45 to 3.48), third-party endorsements and testimonials cannot generally be used in advertising unless permission is obtained from the relevant third party. The following additional rules apply:
- advertisers must hold documentary evidence that a testimonial or endorsement used in advertising is genuine;
- advertisers must hold contact details for the person or organisation that gives the endorsement or testimonial;
- testimonials must relate to the advertised product (rather than, for example, the advertiser generally); and
- claims that are likely to be interpreted as factual and appear in a testimonial must not mislead.
Further, advertising must not display a trust mark, quality mark or equivalent without the necessary authorisation, nor claim that the advertiser or the product has been approved, endorsed or authorised by any public or other body if it has not.
Are there special rules for advertising guarantees?
The advertising codes set out specific rules on guarantees that are defined to include warranties, after-sales service agreements, care packages and similar products. Advertisers should ensure that the word ‘guarantee’ is not used to cause confusion about consumer rights and, for example, it should be made clear if a guarantee is in addition to the statutory consumer rights protection. Advertisers should also ensure that full terms of the guarantee are provided to consumers before they are committed to taking it up and clearly state any significant limitations. If the guarantee is a money-back guarantee, advertisers should refund consumers who make a valid claim promptly.
Are there special rules for claims about a product’s impact on the environment?
The advertising codes do have specific rules relating to environmental claims (section 11 of the CAP Code and section 9 of the BCAP Code).
Environmental claims must be substantiated and based on the full life cycle of the advertised product. ‘Greener’ or ‘friendlier’ can be used if the advertised product provides a total environmental benefit over that of the advertiser’s previous product or competitor products and the basis of the comparison is clear. Advertisers should also consult the Green Claims Code published by the UK Department for Environment, Food and Rural Affairs.
The advertising of certain electrical appliances must comply with the energy efficiency labelling requirements of EU Directive 2010/30/EU on the indication by labelling and standard product information of the consumption of energy and other resources by energy-related products and the Energy Information Regulations 2011 on labelling and standard product information of the consumption of energy.
Free and special price claims
Are there special rules for describing something as free or a free trial or for special price or savings claims?
Advertising must not describe something as ‘free’ if the consumer has to pay anything other than the unavoidable cost of responding and collecting or paying for the delivery of the item. As such, an item cannot be described as free if:
- the consumer has to pay additional fees, such as for packing, packaging, handling or administration charges;
- the cost of what the consumer has to pay to take advantage of the offer (eg, if the consumer has to buy product A to get product B for free), has been increased to make up for the cost of the free item. In conditional-purchase offers particularly, the advertiser must ensure that the ‘free’ item is genuinely separate from and additional to the item being paid for;
- the quality of the product that the consumer must buy to take advantage of the free offer has been reduced; or
- the item constitutes an element of a package unless consumers are likely to regard it as an additional benefit (eg, because it has recently been added to a package without increasing the price).
Advertisers must make clear to consumers the extent of commitment they must make to take advantage of the free offer. Advertisers should also be careful to ensure that there is sufficient availability of the free items. It is advisable to make a reasonable estimate of demand beforehand. With regards to describing something as a ‘free trial’, marketers must not use the term to describe ‘satisfaction or your money back’ offers or offers for which a non-refundable purchase is required.
In relation to special price and savings claims, the advertising codes state that ‘up to’ and ‘from’ pricing claims must not exaggerate the availability or amount of benefits likely to be obtained. When using ‘up to’, at least 10 per cent of the products should be available at the maximum saving. In addition, when making pricing claims based on the recommended retail price (RRP) or a previous ‘was’ price, the RRP or previous price must represent the genuine normal selling price. Savings claims must be genuine (eg, the product must not have been sold at an artificially higher price beforehand). Advertisers should also consult the Chartered Trading Standards Institute Guidance for Traders on Pricing Practices in more detail when making such pricing or savings claims.
New and improved
Are there special rules for claiming a product is new or improved?
Guidance from CAP indicates that ‘new’ should only be used where a product is sold for 12 months or less, although this will depend on the nature of the product being advertised and the specific market. In a fast-moving market (such as technology), it is advisable to stop the ‘new’ claim after a shorter time period. Equally, in slow-moving markets, it may be possible to use the ‘new’ claim for over a year. It is also possible to use a ‘new’ claim where the product itself is not new but there is a new subset of it (eg, a new flavour). There is no specific guidance on ‘improved’, although any such claims should not be misleading, should not exaggerate the extent of improvement and should be substantiated.
Claims of origin
Are there special rules for claiming where a product is made (such as country of origin)?
Marketing communications for any product should not give a misleading impression about the country of origin of that product. In addition, the ASA has issued specific guidance in relation to the country of origin of alcoholic drinks. The guidance provides that advertisers should not mislead about the location of production when making claims that convey origin or heritage. For example, an advert for Kronenbourg lager stating ‘the French are famous for many things, hurrying isn’t one of them. So naturally a beer from Strasbourg, Eastern France is made rather slowly’ was held to be misleading as it implied that the lager was brewed in France whereas it was in fact brewed in the United Kingdom. In addition, ‘geographical or commercial origin of a product’ is listed in Regulation 5 (5) of the CPUTs as one of the ‘main characteristics’ of a product as to which the giving of false information will likely be a ‘misleading commercial practice’ in respect of which enforcement action can be taken.
Prohibited and controlled advertising
Prohibited products and services
What products and services may not be advertised?
Advertising the following products or services to the public is prohibited in both broadcast and non-broadcast advertising: prescription medicines or medical treatments; infant formula; high fat, salt or sugar (HFSS) food products in children’s media; tobacco products and e-cigarettes that contain nicotine and are not licensed as medicines.
In relation to broadcasting and radio, the BCAP Code states that the following is also prohibited:
- political broadcasts, except for certain party political or referendum broadcasts;
- breath-testing devices;
- betting systems or products that are intended to facilitate winning games of chance;
- guns, gun clubs and offensive weapons;
- prostitution, sexual massage services and escort agencies (television only);
- obscene material;
- products (though not services) for the treatment of alcohol and illegal-substance dependence;
- pyramid promotional schemes; and
- the acquisition or disposal of units in collective investment schemes not authorised by the FCA.
Prohibited advertising methods
Are certain advertising methods prohibited?
Under the BCAP Code, radio advertising should not include sounds that are likely to be a safety hazard and television advertising should not be excessively noisy. Television advertising should not include visual effects or techniques likely to adversely affect viewers with photosensitive epilepsy. The Ofcom Broadcasting Code also prohibits subliminal messaging and surreptitious advertising. Unsolicited marketing is generally prohibited in the UK.
Protection of minors
What are the rules for advertising as regards minors and their protection?
Children are defined as being under 16. The principal rules set out in the advertising codes are as follows:
- advertising must not condone, encourage or unreasonably feature behaviour that could be dangerous for children to emulate. Children should not appear unsupervised or going off with strangers;
- advertising must not condone or encourage practices that are detrimental to children’s health;
- advertising must not include a direct exhortation to children to buy or to their parents or guardians; and
- advertising should not present children in a sexual way.
Advertisers should also ensure that they do not take advantage of children’s inexperience, credulity or vulnerability (eg, by exaggerating features of a product) nor imply that children are likely to be ridiculed, inferior to others, less popular, etc, if they do not use a product or service.
There are also scheduling restrictions for broadcast advertising and advertising for alcohol, gambling, HFSS food or medicines should also not be placed in children’s media or target children.
Rules have also been introduced to prohibit the portrayal of under-18s in a sexual way unless the principal function of the advertising is to promote the welfare of under-18s or to prevent harm to them.
Credit and financial products
Are there special rules for advertising credit or financial products?
The advertising of credit and financial products is regulated by the FCA and, under section 21 of the Financial Services and Markets Act, advertisers of such products must be authorised by the FCA. There are also provisions in the CAP Code regarding financial products.
Consumer credit advertising is subject to the FCA’s rules in section 3 of the consumer credit sourcebook and the key rule is for such advertising to be clear, fair and not misleading.
The advertising of high-cost short-term credit (HCSTC) has recently attracted concern, chiefly about targeting vulnerable people who do not always have a full understanding of the terms associated with the loan. Following some high-profile adverse rulings by the ASA, the ASA issued a public consultation in late 2015; but in June 2016, it announced that it had decided not to introduce scheduling restrictions on the advertising of HCSTC.
Therapeutic goods and services
Are there special rules for claims made about therapeutic goods and services?
Rule 12 of the CAP Code and Rule 11 of the BCAP Code deal with the advertising of medicines, medical devices and health. This area is also heavily regulated by statute (Human Medicines Regulations 2012) and enforced by various regulatory bodies such as the Medicines and Healthcare Products Regulatory Agency (MHRA), the Proprietary Association of Great Britain (over-the-counter medicines) and the Association of British Healthcare Industries (medical devices) who also have their own advertising codes.
Medicinal or therapeutic claims can only be made on a medicinal product that is authorised by the MHRA. A medicinal claim is defined as a claim that a product can be used to make a medical diagnosis or treat or prevent disease, injury or an illness.
Food and health
Are there special rules for claims about foodstuffs regarding health and nutrition, and weight control?
Health and nutrition claims are regulated by EU Regulation (EC) No. 1924/2006 on nutrition and health claims made on foods. Under the Regulation, nutrition or health claims can only be made if a claim is specifically authorised and listed on the EU Register of authorised health claims. In addition, any general health claims (eg, X gives you energy) must be supported in the advertising by a specific authorised health claim. Further, there are rules on when nutrition claims can be made (eg, reduced or low claims). For example, reduced sugar claims can only be made if the sugar is reduced by 30 per cent on the previous product.
Regarding weight control products, any claim to the effect that a product is an aid to slimming must be accompanied by a statement making it clear that this will only be the case if it is consumed as part of a proper calorie-controlled diet (Schedule 6 of the Food Labelling Regulations 1996 (SI 1996/1499)). The advertising codes also contain regulations on the advertising of slimming or diet products. Rule 13 of the CAP Code sets out how and to whom weight control products may or may not be marketed.
What are the rules for advertising alcoholic beverages?
The advertising codes require that advertising should be socially responsible and should neither encourage excessive drinking or daring behaviour nor suggest that drinking can overcome boredom, loneliness or other problems. The ASA has issued guidance that advises that advertisers should consider not only the amount of alcohol shown but also the way that drinking is portrayed. Care should be taken not to exploit the young, the immature or those who are mentally or socially vulnerable.
People shown drinking should neither be nor look under 25 years of age and should not be shown behaving in an adolescent or juvenile way, nor should advertising be associated with those under 18 years or reflect their culture. Younger people may be shown in some contexts but should never be shown drinking. Advertising should not suggest that drinking alcohol is a reason for the success of any personal relationship or social event. Links must not be made between alcohol and seduction, sexual activity or success.
The Portman Group Code of Practice (an industry code) also covers the promotion of alcoholic drinks. Although it is a voluntary code, when a complaint is made under the Code to the Portman Group’s Independent Complaints Panel, the panel will try to enforce the decision, in particular through retailer alert bulletins asking retailers not to stock products in breach of the Code.
What are the rules for advertising tobacco products?
The UK has implemented a ban on almost all forms of advertising and promotion for cigarettes and other tobacco products imposed by the EU Tobacco Directive (Directive 98/43/EC). In May 2016, the Standardised Packaging of Tobacco Products Regulations 2015 came into force, introducing plain packaging for tobacco products, e-cigarettes and herbal cigarettes. The regulations stipulate that only minimal branding and advertising is permitted on tobacco products.
Regarding e-cigarettes, the advertising of unlicensed, nicotine-containing electronic cigarettes and e-liquids is prohibited in broadcast media and some non-broadcast media.
Are there special rules for advertising gambling?
The Gambling Act 2005 permits gambling advertising but this law does not apply to Northern Ireland. Section 16 of the CAP Code and section 17 of the BCAP Code contain rules on gambling advertising and spread betting. They focus on ensuring that advertising is socially responsible and does not appeal to or exploit young people (those under 18 years). In 2018, CAP introduced new guidance on responsibility and problem gambling that imposes tougher standards for advertisers to follow when creating gambling advertisements. The new standards restrict adverts that create an ‘inappropriate sense of urgency’ such as those that include phrases like ‘Bet Now!’ to drive offers during live events. They also regulate free bets and bonuses, requiring advertisers to display terms and conditions and significant conditions prominently in any advertised offer. ‘Significant condition’ is defined as conditions that are mostly likely to affect consumers’ understanding of a promotion (including requirements for a consumer to deposit their own funds, wagering requirements, etc). In addition, gambling companies are required to obtain a licence from the UK Gambling Commission, which imposes further controls on advertising.
What are the rules for advertising lotteries?
Lotteries can only be advertised if they are licensed by the Gambling Commission or a local authority. Section 17 of the CAP Code and section 18 of the BCAP Code contain rules on lotteries, and as with gambling, the rules are designed to prevent socially irresponsible advertising or to ensure such advertising does not appeal to young people. Further, advertising must not suggest that participating in a lottery can be a solution to financial concerns or provide financial security. The UK National Lottery must also comply with the advertising controls stipulated in the National Lottery Advertising and Sales Promotion Code of Practice.
What are the requirements for advertising and offering promotional contests?
Promotional contests can be either skills-based competitions or prize draws (games of chance). Advertisers should be careful to ensure that prize draws have a free entry route, otherwise they may be deemed an illegal lottery. The advertising of promotions should communicate all applicable significant conditions or information including how to participate, free entry route information, start and closing dates, prize details, material restrictions (eg, geographical or age) and the promoter’s name and address.
Advertisers should not exaggerate consumers’ chances of winning a promotional contest or imply that they are lucky or have progressed to a further stage in a promotion if they have not. Contests should also be administered fairly (use of an independent panel in skills-based competitions or supervision in prize draws). Further rules are set out in section 8 of the CAP Code and section 28 of the BCAP Code.
Are there any restrictions on indirect marketing, such as commercial sponsorship of programmes and product placement?
Commercial sponsorship is generally permitted in both broadcast and non-broadcast advertising, except for on the state broadcaster, the BBC’s, television channels. Both commercial sponsorship and product placement is regulated by Ofcom’s Broadcasting Code. Programming (including a channel) may not be sponsored by any sponsor that is prohibited from advertising on television and a sponsor must not influence the content or scheduling of programming in such a way as to impair the editorial independence of the broadcaster. Sponsorship must also be clearly identified by sponsorship credits.
Product placement is permitted in films, television series, sports programmes and light entertainment programmes. It must not:
- affect a broadcaster’s editorial independence;
- be surreptitious;
- directly encourage purchase;
- be unduly prominent; or
- advertise any prohibited products.
Further, product placement should clearly be signalled with the PP symbol at the beginning and end of the programme and after any commercial breaks. The Broadcasting Code also regulates virtual advertising and prop placement and prohibits surreptitious advertising.
Other advertising rules
Briefly give details of any other notable special advertising regimes.
The advertising codes have general rules on ensuring advertising does not cause serious or widespread offence. Care must be taken to avoid causing offence on the grounds of race, religion, gender, sexual orientation, disability or age.
It is also worth noting that, although certain political advertising is prohibited in broadcasting, political advertising is generally outside the ASA’s remit.
Are there any rules particular to your jurisdiction pertaining to the use of social media for advertising?
There are no particular rules relating to the use of social media but the advertising codes apply in the same way to social media (including user-generated content that has been adopted and incorporated into advertising) as they do to other marketing communications. Advertisers must also ensure that they comply with the relevant social media platform’s advertising terms and conditions. Particular care should be given when using social media influencers to promote an advertiser’s products or services. New guidance was published by CAP in September 2018 to help social media influencers ensure that they are complying with the advertising rules (ie, by making their advertising ‘obviously identifiable as such’). The ASA recommends that influencers use the following labels to make clear that a particular post is an advertisement: Ad, Advert, Advertising, #ad.
The ASA states that riskier labels include:
- Sponsorship, Sponsored content, Spon, #Spon;
- Thanks to [brand] for making this possible; and
- Just @ mentioning the brand.
More recently, the ASA revealed that it had written to 200 to 300 prominent social media influencers warning them for breaking the rules around making their paid-for or sponsored posts identifiable as advertising. The CMA also expects brands, influencers and media agencies to make sure that any social media content is clearly identifiable as being a ‘paid-for’ advertisement.
Have there been notable instances of advertisers being criticised for their use of social media?
There are a number of examples, including, in June 2018, an Instagram post by a reality television personality that was promoting a watch brand. The post was held to breach the advertising codes for not being clearly identifiable as a marketing communication. The post included the ‘@’ handle of the watch brand, as well as a discount code to use to purchase watches. The ASA, nevertheless, considered that the post should have included an ‘#ad’ handle or ‘#sponsored’ handle to make it clearly identifiable as advertising.
Are there regulations governing privacy concerns when using social media?
Data protection in relation to advertising is generally covered by the Privacy and Electronic Communications Regulations, which regulate direct marketing and the Data Protection Act 2018, which transposed the EU’s General Data Protection Regulation (GDPR) in May 2018. CAP has introduced new rules in the CAP and BCAP Code to ensure that it is aligned with the standards introduced by the GDPR. In a social media context, care should be taken to ensure that users have consented to the use of their data for online behavioural advertising and to receive marketing messages. Unsolicited marketing messages (including via social media) are prohibited.
Update and trends
Updates and trends
An area that we have seen a particular focus on this year is the use of social media influencers for advertising purposes. In addition to the ASA publishing ‘An Influencer’s Guide to making clear that ads are ads’ and issuing hundreds of written warnings to social media influencers for not clearly labelling paid partnerships and advertising, the CMA has also launched its own investigation into influencers’ advertising practices and consumers’ experiences in relation to influencers’ posts. On the back of this investigation, the CMA has issued further guidance on how influencers should label promotional content, including that promoted products and brands should be declared in all subsequent content in which they appear, even if that content is not paid for.
There has also recently been some attention on the practices of travel marketing websites. Following an investigation into the industry, in January 2019 the CMA required six popular hotel booking websites, including Booking.com, Expedia, Hotels.com and Trivago, to sign undertakings to change their practices. The sites must provide the full cost of hotel rooms upfront (eg, including compulsory taxes and charges) and must stop making misleading discount claims. They must also not pressure consumers to book hotel rooms by creating false impressions as to their availability.
Finally, the ASA and the CMA have also been working together this year to investigate the practices of secondary ticketing websites. This has concerned in particular the amount of information that is provided to consumers upfront about the ticket and ticket seller listed on the secondary ticketing website to help consumers decide whether to make a purchase.