Restrictions on multibuy deals and advertising on TV and online have been delayed

New restrictions on the placement of less healthy products will come into force on 1 October 2022.  The Food (Promotion and Placement) (England) Regulations will prohibit businesses from promoting less healthy products in key locations, such as checkouts, store entrances, aisle ends and their online equivalents. Restrictions on multibuy deals and advertising foods high in fat, salt or sugar have been delayed for a year. The restrictions banning HFSS adverts on TV before 9pm and paid-for adverts online will also be paused for a year.

Ofcom seeks to change TV advertising scheduling rules

Ofcom is calling for evidence in relation to whether the amount of advertising shown on public service broadcasters’ (PSB) TV channels needs to be revised.  Currently, the Code on the Scheduling of Television Advertising enables channels to show 12 minutes of television advertising in any clock hour.  Non-PSB TV channels can show eight minutes of advertising in any clock hour.  Ofcom aims to protect viewers’ interests whilst also enabling public service broadcasters to compete with the international streaming industry.  Prior to making any changes, Ofcom will consider all the evidence.  The deadline to provide evidence is 7 October 2022.

The ASA considers young children's recognition of online advertising

The Advertising Standards Authority (ASA) has published new guidance on enhanced disclosure requirements for advertisements that are aimed at young children.  In recent rulings, the ASA has emphasised that younger children posed a particular challenge to marketers, noting that cognitive development was in its early stages meaning they sometimes could not recognise more integrated online marketing communications.  'Enhanced' recognition disclosure is required where an ad is directed at under 12s, is highly immersive or significantly integrated into the surrounding editorial content and unlikely to be identified clearly from the context in which it appeared.

The High Court dismisses all four grounds of Kellogg’s challenge to food promotion laws

Kellogg's has failed in its legal challenge against the government's new restrictions on the placement of less healthy products which are coming into force on 1 October.  The new restrictions will prohibit businesses from promoting less healthy products (including cereals) in key locations.  The company argued that the classification of cereals as unhealthy products was wrong and failed to consider the nutritional value of the milk added to its products.  Kellogg's claim was dismissed in the High Court and the judge held that that the addition of milk would not affect the fact that the cereal was high in sugar.  The ruling means that Kellogg's and other similar companies will now need to comply with the regulations coming into effect on 1 October 2022.

Fashion brands are being scrutinised over sustainability claims by the UK regulator

The CMA is investigating whether claims made by some fast fashion brands constitute 'greenwashing' in light of key legislation.  An initial review earlier this year highlighted concerns about potentially misleading claims, including companies making vague assertions about using recycled materials in new clothing with little basis for those claims.  Other concerns which will be investigated include whether the criteria used to decide which products to include in these collections may be lower than customers might reasonably expect from their descriptions.  Asos and Boohoo, two of the companies under investigation, have stated that they will cooperate with the investigation.  If these companies are found to be misleading consumers, the CMA can force them to change their practices.

CAP and BCAP launch consultation into telecoms advertising

CAP and BCAP are consulting on guidance that would necessitate information about mid-contract prices to be clearly shown in telecoms advertisements.  Some broadband and mobile providers significantly increase their prices mid-term, causing great concern for consumers.  As such, CAP and BCAP are determining what is likely to constitute "clearly showing" or "sufficiently presenting" information about mid-contract price rises in advertisements.  The consultation is open for responses from organisations and members of the public until 5pm on Thursday 17 November and the adverts are assessed by the ASA on a case–by–case basis.

The EU Commission targets greenwashing

In the New Consumer Agenda and the Circular Economy Action Plan, it was made clear that consumers require protection from initiatives that stop them from purchasing goods more sustainably.  For example, consumers will have a right to know how long a product is designed to last for and how, if at all, it can be repaired.  Furthermore, the rules will strengthen consumer protection against unreliable or untrue environmental claims.  The EU Commission is considering making several amendments to the Unfair Commercial Practices Directive (UCPD) to enable consumers to make more sustainable choices.  The reforms will prohibit traders from making generic and vague environmental claims about their products.

The DCMS Committee publishes responses to its report on Influencer Advertising

Recently, the DCMS Committee published responses to its report on influencer culture from the CMA and the ASA.  The report made proposals for the government and recommended amendments to the CAP Code.  For example, the Committee recommended that the ASA be given statutory powers of enforcement and referred to disclosure standards for adverts online targeted at children.  The ASA stated in its response that it takes the issue of influencer marketing seriously and that it is committed to proactive intervention.  The report and responses are important in terms of understanding the regulatory aspects of the promotion of products or services by influencers.

ASA Annual Report 2021

The ASA Annual Report 2021 highlights its use of technology to deal with misleading advertisements online.  The ASA stated that the use of artificial intelligence (AI) is improving its enforcement ability in relation to influencers that fail to disclose when their posts are advertisements.  The AI enables the ASA to recognise which posts are likely to be advertisements but are not disclosed as such, in breach of the CAP Code.  This enables the ASA to increase its monitoring of companies that affiliate themselves with such influencers.  Also, repeat offenders will face the threat of sanctions and enforcement action.

'Buy now, pay later' firms are being monitored by the FCA in relation to advertising

The FCA has informed 'buy now, pay later' firms such as Klarna that it has seen online advertisements and posts by social media influencers that fail to comply with the rules.  For example, some advertisements and posts do not warn consumers of the risks of taking on debt they may not be able to afford.  The FCA is monitoring the market to ensure expectations are met and has confirmed it will use criminal and regulatory enforcement powers if it sees promotions that do not comply.  For example, any companies in breach of the rules could face a maximum sentence of two years imprisonment, a fine, or both.

The DCMS Committee publishes a report on influencer advertising

The DCMS Committee has published a report on influencer culture following its March 2021 inquiry. It makes various recommendations to the government, some of which are already being acted upon. These include:

• Helping to protect influencers from online harassment by amending the Online Safety Bill to tailor complaints mechanisms to specific types of harm.
• Carrying out a market review into the influencer system to look at issues including whether diversity issues affect pay, and whether direct payments to influencers from platforms are fair and proportionate.
• Creating an influencer marketing code of conduct.
• Giving the CMA greater enforcement powers so that it can enforce directly (as already announced in May's Queen's Speech).
• Giving the ASA statutory enforcement powers – to be considered as part of the Online Advertising Program.
• Requiring the ASA to monitor and report on influencer compliance on an annual basis.
• Protecting children from working as influencers.
• Amending the CAP Code.

Market insights report for online advertising published 

In the context of the UK government's consultation on its Online Advertising Programme (which closed on 8 June 2022), a "market insights final report" was published on 30 September.  A consultancy was commissioned to conduct an analysis of online advertising harms, the online advertising market and regulatory landscape. The report covers a taxonomy of 15 categories of harmful advertising, from malicious advertising, to non-identified ads, offensive ads, mistargeting and ad fraud.  It notes the evolution of the market, with increasing expenditure, emergence of new formats which create a risk of inadequate identification of advertising, changed use of data for targeting, and the move away from use of third party cookies. It also notes how the Digital Services Act and Digital Markets Act will impact advertising in the EU, through their regulation of search and social media platforms. 

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