Gregor Kleinknecht discusses advertising regulation in Discover Germany

  • June 27, 2018
  • By Gregor Kleinknecht, Partner

Let there be truth

It must be hard to be an advertising executive and get us to part with our hard-earned cash. In particular, in times when the Brexit pinch is starting to make itself felt on consumer confidence and the economy at large, and businesses and consumers are thinking twice before committing to spending money. No wonder then, that some advertising claims appear more akin to something straight out of Munchhausen’s tales in their extravagance, than being rooted in reality.

Being able to trust and rely on the information contained in advertisements is obviously important, both to protect consumers and to protect businesses from unfair practices by their competitors. So what happens if an advertisement is misleading? In the UK, (most) advertising is subject to self-regulation and co-regulation. Self-regulation means that the advertising industry effectively funds two bodies that uphold advertising standards: first, the Committee of Advertising Practice (CAP), which is responsible for writing the Advertising Codes; there are separate non-broadcast and broadcast advertising codes. Secondly, there is the Advertising Standards Authority (ASA), an independent advertising regulator which is tasked with ensuring that ads across UK media actually stick to the advertising rules. The remit of the ASA also includes claims made by companies on their own websites and in social media spaces under their control and, in particular, also online behavioural ads.

Co-regulation means that the ASA has been given responsibility for regulating the content of broadcast (TV and radio) ads under contract from Ofcom, the separate communications regulator, which is otherwise responsible for regulating the TV, radio and video-on-demand sectors, fixed-line telecoms, mobile phones and postal services in the UK. The vast majority of TV and radio ads are actually pre-cleared before they are broadcast, and two more bodies have been set up to provide that service: Clearcast for television commercials and Radiocentre for radio ads.

Last year, the ASA resolved over 29,000 complaints relating to just under 16,000 ads. In addition, it resolved 5,425 cases in which it took action of its own initiative. As a result of that work, 4,584 ads were either changed or removed. 97 per cent of the complaints it received last year came from members of the public.

To pick just one example of a complaint recently upheld by the ASA, a national press ad for a posh supermarket seen on 19 December 2017 featured text that stated, “We’re £10 cheaper than in 2016** As reported by Good Housekeeping Institute ….The only supermarket where Christmas dinner cost less than last year* …”, which was found to be misleading because two of the products included in a 2016 basket of goods had been replaced with cheaper alternatives for 2017 and the comparison was therefore not like-for-like.

However, and perhaps rather confusingly, there are areas that fall outside of the ASA remit and where complaints are dealt with by separate, sector specific regulators. They include, in particular, credit and financial advertising (Financial Con-duct Authority), the use of personal data for electronic marketing (Information Commissioner’s Office), phone paid services (PhonepayPlus), some advertising for medicines (Medicines and Healthcare Products Regulatory Agency), and political advertising (Ofcom).

So, next time an ad for a wonder tincture claims to make your hair strong enough to pull yourself out of the mire by it, or that there will be a Brexit dividend to fund the NHS, you know who to call.


This article was published in Discover Germany in the July 2018 Issue and can be read on page 116 here.

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