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Ads & Brands Law Digest: June-July 2020

06 July 2020

Welcome to the June-July 2020 issue of our monthly Ads & Brands Law Digest.

Advertising & Marketing

ASA launches Scam Ad Alert system

The Advertising Standards Authority (in collaboration with the IAB and its members) has published a new form for the speedy reporting by consumers of online scam ads, whether published in social media, search results or on news websites. Examples that the ASA cites include fake news about celebrities or fake endorsements by celebrities, which link through to sites with fraudulent content such as scams relating to crypto-currencies.

When such a form is submitted and evidences criminal intent on the part of the advertiser, the relevant information is then forwarded on to participating platforms, including Google and Facebook, and relevant publishers. They will then act to remove the offending ad, suspend the advertiser’s account, and potentially add them to blocklists.

Read more here.

Ad featuring “everyday” reminders of online gambling held not in breach of BCAP Code

The BCAP Code on broadcast advertising states that ads must not portray gambling as indispensable or as taking priority in life.  Ladbrokes ran a TV ad which showed how various situations from everyday life could remind people of online casino games, and could be engaged with in a way analogous with such gambling.  For example, a woman in a clothes shop was shown saying “There are few things more exciting than a spinning wheel. I’m going for red, definitely red. OK black…” while she span a circular clothing rail which contained alternating red and black clothing.

Five complainants challenged whether the ad was therefore in breach of the Code, by making gambling appear as a priority in life for the people featured in the ad.  But interestingly the ASA felt that Ladbroke had stayed on the right side of the line.  While the ad showed people being reminded of gambling in their everyday activities, and responding to the situation in a gaming-related manner, these responses were only temporary and did not distract the characters from completing the everyday tasks in question.  For this reason, the ASA did not feel that the ad depicted gambling as “taking priority”.

Read more here.

Company banned and fined £1 million for misleading call connection service

Businesses operating in the specialist field of premium-rate phone services have a powerful regulator of their own to watch out for when it comes to misleading promotional material.  The Phone-paid Services Authority (PSA) has recently flexed its muscles by imposing a £1 million fine on Salvatet Inversiones SL, banning it from the premium rate services market for 5 years and ordering it to make refunds to out-of-pocket customers.  Salvatet ran an “information, connection and signposting” service which connected consumers by phone to well-known companies and government departments.  But it had been doing so using misleading websites and sponsored Google ads, and had failed to quote its charges with sufficient prominence.  It was also in breach of various PSA Code conditions.

Read more here.

Ofcom finds that “pat on the back” local radio news item implied a commercial arrangement 

While it sub-contracts the day-to-day regulation of broadcast advertising to the ASA, Ofcom retains direct responsibility for the regulation of sponsorship arrangements in broadcasting, and also of commercial references within programmes themselves.  The Ofcom Broadcasting Code includes a special rule 10.3 relating to news bulletins and news desk presentations, forbidding any “commercial references or material that implies a commercial arrangement.”

This Ofcom ruling related to a local radio station called Hit Mix, based in Staffordshire, that had broadcast a piece about a local Chiropractic business celebrating the 10th anniversary of its launch, as part of a morning news bulletin.  The item was intended as a local “good news story”, but Ofcom received a complaint that it contained promotional references.  The broadcaster confirmed that the story had not been subject to any commercial arrangement, and suggested that it should just be regarded as a “pat on the back” for a successful local business.  However, given the detailed nature of the references to the business, and the particular need to keep news items free from any suggestion of commercial influence, Ofcom did feel that listeners were likely to have assumed that a commercial arrangement was in place.  (In principle this was a breach of Rule 10.3 of the Code, but as the licensee broadcaster accepted that it had made a mistake, and had put in place revised procedures, Ofcom considered the matter resolved.)

Read more here.

Competition Law & Regulatory

CMA issues fines for resale price maintenance in online musical instrument sector

The Competition & Markets Authority (CMA) has once again shown its teeth in cracking down on businesses that try to restrict the discount pricing of their products online. On 29th June it announced fines totalling £5.5m had been imposed upon two musical instrument manufacturers for implementing resale price maintenance in their sector, and a further big fine against a retailer who had been complicit in the arrangements. The CMA has also announced that it is now using an automated price tracking tool to monitor for unlawful restrictions upon online discounting in the musical instruments marketplace, with a view to rolling it out to other sectors in the future.

Read more here.
CMA issues final recommendations on Online Platforms and Digital Advertising

The Competition & Markets Authority has also just published the final report resulting from its market study of digital advertising and the major online platforms. Rather than conduct a more detailed market investigation, the CMA recommends that the government should now legislate to introduce a new regulatory regime based upon an enforceable code of conduct for powerful “tech giants” that are funded by digital advertising (such as Google and Facebook).  The new regime would be run by a Digital Markets Unit, empowered to make “pro-competitive interventions” against the platforms.  Examples of such potential interventions given by the CMA include: preventing exploitative or exclusionary practices resulting from market power; ensuring that consumers have a choice over whether to receive personalised advertising (without having to opt out of the service altogether); introducing a “fairness by design” duty on platforms; and ordering the separation of platform businesses where necessary to ensure healthy competition.

Whether the government chooses to legislate to implement the CMA’s recommendations remains to be seen.  In the meantime, the CMA has formally launched the Digital Markets Taskforce, which the government has asked to advise it (by the end of 2020) on a new regulatory regime for digital markets more generally.  The CMA has also collaborated with the Information Commissioner’s Office and Ofcom to set up a new “Digital Regulation Cooperation Forum” to coordinate activity between the three regulators.

Read more here and here.

Trade Marks & Domain Names

High Court confirms rejection of 'Nosecco' figurative mark on basis of Prosecco protected designation of origin

The UK Intellectual Property Office had ruled in opposition proceedings that a figurative mark including the text “Nosecco” (for non-alcoholic wines) should not be given protection, based upon the fact that there was a pre-existing EU protected designation of origin (PDO) for Prosecco.  This High Court case was an appeal by the applicant, but the judge upheld the UK IPO ruling.  Registration of the Nosecco mark would potentially damage the PDO for Prosecco, and there was a risk that consumers might be deceived.  Recent cases before the EU IPO that had apparently been decided differently (e.g. registration of “Sol de Mallorca” for a non-alcholic wine when there was a protected geographical indication for Mallorca) could be distinguished on their facts from the current case. 

Read more here.
Timetable confirmed for withdrawal and revocation of .eu domains held by UK registrants

We have flagged up in previous editions of this Digest that at the end of the Brexit transition period some UK holders of .eu domain names will potentially lose those domains. This is because only EU citizens or residents, and businesses/organisations established in the EU, can hold .eu domain names. UK businesses owning such domains must update their registration details before 31st December 2020 to demonstrate how they fulfil the EU residency/establishment requirements, otherwise their domain names will be withdrawn by the registrar (EURid) as of 1st January 2021 and the relevant domain names will be revoked and available to other registrants as of 1st January 2022.

Read more here.

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