Advertising law regulatory framework

Above-the-line advertising is regulated by a combination of legislation and self-regulatory codes of conduct.

Advertising law legislative framework

The main pieces of advertising law controlling advertising content in the UK are:

  • Consumer Protection from Unfair Trading Regulations 2008 (CPUT Regulations).
  • Business Protection from Misleading Marketing Regulations 2008 (BPRs).

Self-regulation

Self-regulation is very important in the UK. The main enforcement body is the Advertising Standards Authority (ASA), which enforces rules for both broadcast and non-broadcast advertising. The ASA is independent of both government and industry. The regimes for broadcast and non-broadcast advertising are considered below.

Other bodies and codes exist for certain industries.

Broadcast advertising

Broadcast advertising covers television (including interactive television) and radio advertising. The UK is subject to EU broadcasting legislation, which has been implemented largely by the Communications Act 2003.

The Office of Communications (Ofcom) has control over the content of all television broadcasting, including control over the content of advertising. Ofcom has published a Broadcasting Code covering radio and television broadcasting but outsourced broadcast advertising regulation to the ASA. Therefore, the ASA operates and enforces the Broadcast Advertising Code (BCAP Code), produced by Broadcast Committee of Advertising Practice (BCAP).

Pre-clearance for broadcast advertising

Clearcast pre-vets all UK broadcast advertising on behalf of the commercial television networks who are jointly responsible with advertisers and agencies for ensuring the advertising shown on their networks is compliant. The Radio Advertising Clearance Centre (RACC) pre-vets advertising for radio. Both organisations will give advice on what is likely to be acceptable advertising content.

Non-broadcast advertising

The current non-broadcast code is the 12th edition of the UK Code of non-broadcast Advertising, Sales Promotion and Direct Marketing (the CAP Code).

The CAP Code is written by the advertising industry through CAP and is based on International Chamber of Commerce Codes. 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 which contravenes the CAP Code.

The CAP Code is also enforced by the ASA, which is independent of both government and industry (although funded by an industry levy on advertising space). It covers online advertising and the following areas:

  • Advertisements in newspapers, magazines, brochures, leaflets, circulars, mailings, e-mails, text transmissions (including MMS), fax transmissions, catalogues, follow-up literature and other electronic and printed material.
  • Posters and other promotional media in public places.
  • Cinema and video commercials.
  • Advertisements in non-broadcast electronic media, including online advertisements in paid-for space (including banner and pop-up advertisements), paid-for search listings, preferential listings on price comparison sites, viral advertising, in-game advertisements, commercial classified advertisements, “advergames” in display advertisements, Bluetooth advertisements, advertisements distributed through web widgets, and online sales and prize promotions.
  • Marketing databases containing consumers’ personal information.
  • Sales promotions.
  • Advertorials.
  • Advertisement promotions.
  • Advertisements and other marketing communications by or from companies, organisations or sole traders on their own websites or other non-paid for space online under their control.

Sanctions for breach of the BCAP and CAP Codes

If the ASA finds that an advertisement breaches the BCAP Code or the CAP Code, the ASA will ask the advertiser to withdraw or change it. The ASA cannot levy fines. However, it does have a number of other sanctions which it can use to ensure compliance.

Controls on advertising content

The main controls on advertising content are set out in the CPUT Regulations and in the CAP and BCAP Codes. The BCAP/CAP Codes’ main provisions are that advertisements should be legal, decent, honest and truthful, that they should not mislead and that advertisers should be able to substantiate all objective claims made.

False and misleading advertising

It is a criminal offence under the CPUT Regulations to make misleading statements about, among others:

  • The existence and nature of a product.
  • The main characteristics of the product.
  • The price (including how it is set).

Comparative advertising law

Comparative advertising vis-a-vis consumers is governed by the UPCD and the CPUT Regulations.

A consolidated Directive (concerning misleading and comparative advertising) (Comparative Advertising Directive) governs business to business advertising and was implemented in the UK by the BPRs.

A comparative advertisement is one that explicitly or by implication identifies a competitor or goods or services offered by a competitor (Article 2(c), Comparative Advertising Directive). A comparative advertisement is permitted as long as it fulfils particular conditions, including the following:

  • It is not misleading within the meaning of Articles 2(b), 3 and 8(1) of the Comparative Advertising Directive.
  • It compares goods and services meeting the same needs or intended for the same purpose.
  • It objectively compares one or more material, relevant, verifiable and representative features of those goods and services, which may include price.
  • It does not discredit or denigrate the trademarks, trade names, other distinguishing marks, goods, services, activities or circumstances of a competitor.
  • For products with designation of origin, it relates in each case to products with the same designation.
  • It does not take unfair advantage of the reputation of a trade mark, trade name, or other distinguishing marks of a competitor or of the designation of origin of competing products.
  • It does not present goods or services as imitations or replicas of goods or services bearing a protected trade mark or trade name.
  • It does not create confusion among traders, between the advertiser and a competitor or between the advertiser’s trade marks, trade names, other distinguishing marks, goods or services and those of the competitor.

Advertising claims as contractual terms

While most advertisements will be classified as a mere invitation to make an offer, there are situations, depending on the jurisdiction, where advertisements can form a valid contract between the advertiser and the buyer. Care should, therefore, be taken in wording any advertisement.

Claims made in an advertisement will not usually become terms of a contract entered into in reliance upon those claims (although there may be liability for false or misleading advertising. However, a statement in an advertisement may form part of a description of a product so as to give rise to an implied term in the contract of sale that goods correspond with that description.

For any questions you may have concerning advertising law contact Sharon Playford.