Regulation of the Advertising Industry
Advertising is one of the most effective ways to promote products and services. However, in the UK businesses must be very careful about what and how they advertise. Any advert must comply with very strict regulations. Regulation advertising Industry is undertaken by the Advertising Standards Authority (ASA).
This authority was set up to create standards in the industry focusing on consumers, advertising and society. The Advertising Standards Authority is completely independent from the government and the advertising industry and this is recognised by the courts and agencies such as the Office of Communications (OFCOM) and the Office of Fair Trading (OFT).
Throughout the UK the Advertising Standards Authority are accountable for monitoring communications for all types of media. This includes:
- Advertisements for press and print
- Any type of poster
- Advertisements for television and radio
- Any advertisement that appears online including paid adverts such as banner and pop up ads, commercial emails and promotions. Product and service pages on websites are excluded.
- Text messages that are promotional in nature
- Direct mail including leaflets, catalogues, brochures and letters
- Promotional material for sales and/or offers
- Teleshopping and advertising in cinemas
Purpose of the ASA
The Advertising Standards Authority was established to bring about consistency, fairness and accountability in advertising. In addition, there are certain principles and guidelines that govern how advertisements are used. Codes are in place to provide advice, resolve complaints and conduct research.
If a business or individual creates any type of marketing or advertising material, it must include an accurate description of the product or service, be legal, decent, truthful and honest and be socially responsible. Being socially responsible means avoiding promoting or encouraging unsafe, illegal or anti-social behaviour.
Accuracy of Product or Service Descriptions
The law states that advertising and marketing materials must accurately reflect the product. This means that you must be able to prove any claim that you make about a product or service. When you list pricing information, this must be the actual cost of the product in addition to any other fees such as ongoing subscriptions and taxes.
The regulations are in place to regulate how advertising is carried out and what an advertiser can and cannot do. Specifically, the Consumer Protection from Unfair Trading Regulations are applicable here and this prohibits any marketing or advertising from being misleading or harassing customers.
This includes distributing messages that are deceptive or false, omitting important information or using aggressive sales techniques. Where the advertising takes place on a business to business level, the advertiser cannot make misleading comparisons with their competitors such as comparing a product of yours with a competitor with a different product or using the trademark or logo of your competitor.
In addition to these regulations there are also two codes of practice that govern advertising. Everyone who advertises must comply with these regulations to ensure that they are in full compliance with the law.
The two codes of practice carefully detail how businesses can advertise and it includes all types of communications depending on where the advert will appear.
The first code of practice refers to non-broadcast media which covers online advertising, direct marketing and sales promotions. Under this code, businesses must comply with a variety of conditions including avoiding advertising that will cause offence, advertise politically or be targeted towards children.
The second code of practice is for broadcast media, covering television and radio advertisements. Under this code, advertisers must comply with guidance for advertising that covers issues such as decency, taste and the placement of products. Alongside accuracy and honesty, the code also specifies certain rules for scheduling.
Rules of the Advertising Codes
As outlined above, an advertisement should never break the law and it should not encourage others to do so. The advert should also be decent and avoid causing any type of offence. An advertiser should exercise caution when creating any ads ensuring that they do not cause offence.
That being said, whether a product itself is offensive is not a justifiable reason for judging an advert as being offensive. Furthermore, advertisements should never take advantage of inexperience of consumers and it must not in any way be misleading. This is particularly important when prices are displayed, and testimonials are used about the product.
Advertisers must also be socially responsible. This means that they cannot condone anti-social activity or violence and the privacy of consumers cannot be exploited. Featuring or referring to customers without their consent can be a breach of the code.
Fair competition is also applicable when advertising to consumers. Advertisers should avoid belittling or undermining competitors or exploiting the goodwill of others. In addition to the consumer protection regulations, there is a further layer of legislation that govern how advertising is carried out in relation to alcoholic drinks, health and beauty claims, medicine, financial products, gambling, promotions of prizes and direct marketing.
Consumers may make a complaint to the Advertising Standards Authority if they believe that an advert contravenes the regulations or if:
- You think that there is something wrong with an advertisement that you have heard or seen
- You believe that a competition, prize or special offer has been unfairly managed
- You would like to stop direct mail from a company that was sent to you by email, text message, post or fax
- You believe that there is something wrong with the marketing material on a company’s website or social media platform
The first step in the complaints process is to check that the complaint is something that the Advertising Standards Authority can deal with.
When the ASA receive a complaint, they will consult the various advertising codes which act as a rulebook to determine whether the issue raised by the complainant did actually breach any of the codes of practice.
The Advertising Standards Authority will make weekly checks to ensure that advertisers are fully complying with the rules of the codes.
Enforcement and Sanctions
Once a complaint has been investigated and it is concluded that a breach occurred, the Advertising Standards Authority has the power to grant a number of sanctions including:
- Requesting that the advertiser withdraw the advertisement from circulation
- Requesting publishers and media owners to not allow advertising space to be used for a particular advert until changes have been made
- Negative publicity. The Advertising Standards Authority can publish breaches which can result in bad publicity for a business
- Removal of trading privileges. Incentives or financial discounts can be withdrawn
- Legal proceedings. In the worst cases, the Advertising Standards Authority can refer persistent offenders to the Office of Fair Trading who have the power to commence legal proceedings for an injunction.
If you regularly prepare advertisements for clients or you are a business owner who advertises, it is of utmost importance that you adhere to the regulations and codes of practice for advertising.
About the Author
This article was written by a member of the Expert Answers team and posted by Lloyd Barrett, Admin & Customer Services Manager for online advice service Expert Answers. Expert Answers provides legal advice to users in the UK who post a question on their secure platform.