Corporate Focus - February 2010
Changes Website Content Regulation
At the end of last year there were some press reports, now
filtering through to legal journals, indicating that there was to
be a significant change in the way website content is policed by
bringing it within the remit of the advertising standards authority
and the CAP codes. The CAP codes are the codes of practice that set
out the standards by which the advertising industry self-regulates,
and currently it does not extend to the content of websites except
for some very limited exception, such as promotions and prize draws
contained within sites and banner advertising. Proposals to extend
the scope of the codes have not been published to date and would
have to be ratified by the Advertising Standards Board of Finance
(ASBOF), the Advertising Standards Authority Council (ADS), the
Committee of Advertising Practice (CAP) and by the Advertising
Association. However it is correct to say that funding was agreed
to extend the remit of the ASA with part of the seed capital coming
from Google.
Although many feel this would be a very important strengthening
of the reach of the self- regulatory system; in fact, some of the
press reports have been somewhat misleading and have implied
firstly, that the proposals are definitely coming into force later
this year and secondly, that currently website content is
unregulated.
Dealing with each of these points in turn:
- Although funding has been agreed, any proposals have to come
from the advertising industry itself rather than being instigated
by the CAP or ASA. Therefore the ASA can make no comment, at this
stage, other than to say that the question is under consideration
and that they are expecting proposals later this year (which would
then have to be ratified by ASBOF, the ASA, CAP and the Advertising
Association). Hence, there is no formal statement from the ASA or
CAP to validate that the extension is either proposed or ratified,
much less any firm implementation date. It would, however, come as
no surprise to the industry if the proposals, when published, do
indeed extend the remit of the ASA and the codes to website content
which has become the source of an increasing number of consumer
complaints to the ASA and CAP.
- The Consumer Protection from Unfair Trading Regulations
(“CPRs”) came into force in 2008 and replaced the Control of
Misleading Advertising Regulations 1988 which applied to website
content.
There are some very significant differences between the regimes
under the CPRs and under the CAP codes. The CPRs set out general
obligations not to trade unfairly and misleading advertising is
encompassed within this, in terms of the general prohibition on
misleading actions and also in respect of a number of the specific
blacklisted activities listed in the schedules to the CPRs which
are automatically considered to be an unfair trade practice. The
enforcement route under the CPRs, can be criminal or can take the
form of either, undertakings sought by the OFT or trading standards
or, in the case of a recent action against the promoters of
scratchcards, an injunction against both the business and
individual officers.
The CAP code contains a general requirement that advertisements
are legal, honest and truthful but it also sets out very specific
content rules and a number of industry and product/service specific
rules. The CAP code is used much more widely and its main sanction
is adverse publicity. It relies on publicity to pressure
advertisers not to continue to breach the codes after an adverse
adjudication, although there is still the possibility of referring
persistently non co-operative advertisers to the OFT for action
under the CPRs.
Although there is currently no requirement on the promoters of
websites to comply with the CAP codes, as a matter of good
practice, we have always recommended doing so as the code
represents best practice; and a website that complies with the very
specific rules set out in the codes, was potentially less likely to
be considered to be misleading under the CPRs and for the time
being at least, this continues to be the case.
Going forward, if the scope of the codes is extended, websites
are likely to come under greater scrutiny as the ASA and CAP is
more focused on investigating complaints by consumers about
advertising than either the OFT or trading standards (which have a
far wider remit to regulate and monitor business practices). The
process for complaints and adjudications under the CAP codes is
also faster, arguably less expensive and more easily accessible by
the consumer than enforcement by the OFT has been so far; however
what remains to be seen when, or if, the rumoured proposals for the
extension of the codes to cover website content are published, is
how the ASA and CAP plans to deal with such difficult issues as
foreign owned, managed or originating sites that are viewed by
consumers in the UK, and what sanctions they consider
appropriate.
In Europe at least, a complaint in an EU member state can be
referred to the regulatory authorities in the member state where
the owner or the offending site is based for enforcement; the ASA
and CAP do not have this facility or remit beyond the UK. If the
codes seek to regulate the content of sites that originate outside
of the UK, but can be viewed by UK residents, then this may then
set an interesting precedent for how other countries will look to
regulate UK-originating sites that can be viewed by consumers who
are resident overseas.
If you would like any further information on this topic,
please contact Janet Weil, Consultant in our Corporate, team on
0151 242 6521 or janet.weil@weightmans.com