ΩRepresentative offices
Promoting
Your Business
A legal checklist
Almost every organisation produces material to promote its business. This checklist is designed to help identify, at the creative and approval stages, potential issues under English law and regulation. This helps to avoid wasted time and costs in developing content that is legally problematic.
For further information, please contact your usual Taylor Wessing advisor or one of our specialists, whose details are provided at the back of this checklist.
Some of the issues covered may also apply to other jurisdictions. Please let us know if you would like advice on the law in other jurisdictions including Germany, France and Belgium.
The checklist is intended for general guidance only and does not represent legal advice.
Timothy Pinto +44 (0)20 7300 4287 t.pinto@taylorwessing.com Mark Dennis +44 (0)20 7300 4107 m.dennis@taylorwessing.com
Editors
General advertising issues
Advertising standards – Non-broadcast 4 Advertising standards – Broadcast 6 Business to business – Misleading advertising 7 Business to consumer – Unfair trading 8 Comparative advertising 10 Contracts with customers 11 Creative and media agency contracts 11Intellectual property
Copyright 14 Keyword advertising 14 Moral rights 15 Passing off 15 Performers' rights 15 Registered trade marks and domain names 16Media
Data protection 18 Defamation 18 Malicious falsehood 19 Obscenity, indecency and incitement19
Privacy and confidentiality 19
Specific areas
Company trading disclosures 22 Competition law 22 Consumer credit 22 Distance selling 23 Financial services 24 Lotteries, prize competitions and similar promotions
24
Medicinal claims 25 Olympics and major
sporting events
26
Premium rate numbers 27 Product placement 28 Social media, user-generated content, astroturfing and viral advertising
29
Ticket promotions 30
Practical issues
Dealing with intellectual property ownership and rights
32
Types of media 32 Other jurisdictions / internet 32
Contacts
33Advertising standards – Non-broadcast 4 Advertising standards – Broadcast 6 Business to business – Misleading advertising 7 Business to consumer – Unfair trading 8 Comparative advertising 10 Contracts with customers 11 Creative and media agency contracts 11
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General advertising issues
Advertising standards – Non-broadcast
Does the British Code of Advertising, Sales Promotion and
Direct Marketing (known as the "CAP Code") apply to the advertisement? (check www.asa.org.uk)
The CAP Code applies to marketing communications such
as promotional posters and advertisements in newspapers, magazines, leaflets, emails, text transmissions and on the advertiser's own website and in other online space under their control (e.g. social media).
The CAP Code does not apply to, for example, broadcast
commercials (covered by broadcasting codes – see page 6), and some types of press releases.
If the CAP Code applies, does the advertisement comply?
For example:
›Does the advertiser possess documentary evidence substantiating all claims which are capable of objective substantiation?
›Are all claims legal, decent, honest and truthful and prepared with a sense of responsibility to consumers and society?
›Is every claim fair, accurate and not misleading?
›Does the advertisement contain nothing that is likely to cause serious or widespread offence, such as on the grounds of race, religion, sex, sexual orientation or disability?
›Is the advertisement an 'advertorial' (see definition on page 9)? If so, it must be suitably labelled.
›Check for specific rules e.g. for the advertising of food (in particular, to children), alcohol, financial products, gambling, medicines, tobacco, motoring, travel, weight control regimes, and health and beauty products.
Sanctions for non-compliance include:
›an adverse adjudication (potentially leading to adverse publicity);
›a request for pre-vetting of advertisements by the Committee of Advertising Practice; and/or
›a referral to the regulators who can take civil or criminal action.
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General advertising issues
Advertising standards – Broadcast
Do the relevant broadcasting codes apply to the advertisement?
(see www.asa.org.uk)
Advertisements are regulated under the BCAP Code but product
placement and sponsorship are regulated under the OFCOM Broadcasting Code.
Many of the considerations for non-broadcast advertising (see
page 4) are also relevant to broadcast advertising.
Specific considerations include:
›Is there a clear distinction between the advertisement and programmes?
›Does the advertisement confuse or materially mislead viewers? For example, an advertisement must not mislead viewers into believing they are watching a programme e.g. by featuring current news or current affairs presenters.
›Does the advertisement promote or publicise bodies with political objectives, or products or services which are prohibited such as prescription-only medicines and products for the treatment of alcohol or other substance abuse?
›Does the advertisement cause serious or widespread offence against generally accepted moral, social or cultural standards of the time? There may be restrictions as to when an advertisement is allowed to be broadcasted.
›There are extensive rules as to how particular products or services can be advertised including gambling, financial products, alcohol and premium rate telephone services.
Business to business – Misleading
advertising
If advertising to another business, does the advertisement
comply with the Business Protection from Misleading Marketing Regulations 2008? If not, this may be a criminal offence.
An advertisement is defined as "any form of representation
which is made in connection with a trade, business, craft or profession in order to promote the supply or transfer of a product".
Is the advertisement misleading? The test is whether it "in any
way, including its presentation, deceives or is likely to deceive the traders to whom it is addressed or whom it reaches; and by reason of its deceptive nature, is likely to affect their economic behaviour; or for those reasons, injures or is likely to injure a competitor".
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General advertising issues
Business to consumer – Unfair trading
If advertising to a consumer, does the advertisement comply
with the Consumer Protection from Unfair Trading Regulations 2008? Broadly, the Regulations prohibit the following unfair commercial practices if they cause or are likely to cause the average consumer to take a transactional decision he or she would not have taken otherwise:
›commercial practices which contravene the requirements of professional diligence;
›misleading actions, such as providing false information or providing marketing which may confuse consumers into making an uninformed decision; and
›misleading omissions e.g. omitting or hiding material information or providing it in an unclear, unintelligible or untimely manner.
Does the advertisement contravene any of the 31 "blacklisted"
practices, which are deemed unfair? These include:
›describing a product as gratis, free or without charge if the consumer has to pay for anything other than the cost of responding to the marketing material or the cost of collection or delivery of the item;
›including in marketing material an invoice or similar document seeking payment which gives the consumer the impression that he or she has already ordered the marketed product when this is not the case;
›claiming to offer a competition or prize promotion without awarding the prizes described or a reasonable equivalent;
›using editorial content in the media to promote a product where a trader has paid for the promotion without making that clear to the consumer, i.e. advertorials; and
›falsely claiming or creating the impression that the trader is not acting for purposes relating to his or her trade, business, craft or profession, or falsely representing oneself as a consumer (sometimes known as "astroturfing", for example where a business, whether or not via an employee, anonymously posts positive user reviews in social media about its own products or negative ones about a competitor's product).
Is the advertisement aimed at children or those who are in some
way particularly vulnerable? If so, this is taken into account in deciding whether the practice is unfair.
The Regulations provide for a range of sanctions including up to
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General advertising issues
Comparative advertising
Does the advertisement in any way, either expressly or by
implication, identify a competitor or the goods or services offered by a competitor? If so, as far as the comparison is concerned, the advertisement will only be permitted if it complies with certain conditions, including:
›it is not misleading;
›it compares products meeting the same needs or intended for the same purpose;
›it objectively compares one or more material, relevant, verifiable and representative features of those goods and services, which may include price;
›it does not create confusion in the market place between the advertiser and a competitor or between the advertiser's trade marks, trade names, other distinguishing marks, goods or services and those of a competitor;
›it does not discredit or denigrate the trade marks, trade names, other distinguishing marks, goods, services, activities or circumstances of a competitor; and
›it does not take unfair advantage of the reputation of a trade mark, trade name or other distinguishing marks of a competitor or of the designation of origin of competing products.
Contracts with customers
Is the advertiser intending to form a contract? If so, is there an
offer and acceptance mechanism? Does the customer clearly commit to a legal contract?
Are all contract terms clear, enforceable and in compliance with
the law?
For consumer contracts, are the terms fair and easy to
understand under the Unfair Terms in Consumer Contracts Regulations?
Creative and media agency contracts
Is there a written contract?
What is the geographical scope and duration?
Who owns the rights in the advertisement and other copy? Is it an exclusive contract? - Can the agency work for your
competitors? Can your company appoint other agencies?
What is payable to the agency? Who carries liability and is it limited? Can the agency sub-contract? Can the contract be terminated early? Are there keyman clauses?
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Promoting Your Business - A legal checklist
Copyright 14
Keyword advertising 14
Moral rights 15
Passing off 15
Performers' rights 15 Registered trade marks and domain names 16
Copyright
Does the advertisement contain all or part of a copyright
protected work, e.g. words written, spoken or sung, photographs, images, graphics, paintings, sculptures, sound recordings, music, film, animations, software, dramatic works or broadcasts?
There may be copyright in storyboards, formats, typographical
layouts, treatments, etc.
Many copyrights may be involved. Each may have different owners.
Has copyright consent been obtained from every owner (or
relevant collecting society) for every work? If not, is there a defence to infringement?
Keyword advertising
Some online service providers allow advertisers to buy
"keywords". When a user searches on that keyword, the advertiser's advertisement appears alongside the search results.
Is the advertiser considering using a third party's (e.g. a
competitor's) trade mark, or a similar mark, as a keyword? If so, this may give rise to trade mark issues. The legal position varies between jurisdictions. It is advisable to seek specialist advice.
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Intellectual property
Moral rights
Creators of copyright works (who may not be the current
owners of the copyright) may have moral rights – e.g. the right to be identified and the right not to have their work subjected to derogatory treatment.
Has a waiver of moral rights been obtained?
Passing off
Does the advertisement make a representation that may
confuse consumers into thinking that the advertiser's goods or services are those of, or are connected to, another company or individual, or are endorsed or approved by them? If so, this could amount to passing off.
Performers' rights
If all or part of a recording of a performance is being used in
the advertisement, has consent been obtained from all actors, dancers, musicians and other performers, and those having recording rights in the performance?
Registered trade marks and domain names
Does the advertisement contain a sign which is identical
or similar to a third party's registered trade mark (whether intentionally or unintentionally)?
If so, trade mark law may apply. It is advisable to seek specialist
advice.
Carry out trade mark searches to check.
See also the sections on keyword and comparative advertising
above.
Consider obtaining appropriate domain names to ensure that
your brand is sufficiently protected.
Consider which top-level domain names would be appropriate,
such as generic (e.g. .com, .info), country-code (e.g. .uk or .fr) or other top-level names (if relevant).
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Promoting Your Business - A legal checklist
Media
Data protection 18
Defamation 18
Malicious falsehood 19 Obscenity, indecency and incitement 19 Privacy and confidentiality 19
Data protection
Does the advertisement include a section for consumers to fill in
their personal details e.g. name and address?
Does this section explain how collected information is used? For
example, will it be used for follow-on marketing?
Is more information collected than is necessary?
Does the use of any collected personal information comply with
the Data Protection Act?
Does the use of any personal information collected for marketing
by email, telephone or fax comply with the Privacy and Electronic Communications Regulations?
Are cookies used to target the advertisement? If so, user
consent may be required.
Defamation
Is there anything in the advertisement which would make
ordinary people think the worse of a person identified?
Does the advertisement expose anyone to ridicule or contempt? Is the advertisement detrimental to the office, trade or
profession of a person?
A person might be identified by implication or accident. Companies can be defamed as well as individuals.
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Media
Malicious falsehood
Are there any false statements in the advertisement? Has the advertiser been reckless as to the truth or made any
representations with an intention to injure or knowing that they are false?
Obscenity, indecency and incitement
Is the advertisement illegal due to obscenity or indecency? Does the advertisement incite racial or religious hatred?
Privacy and confidentiality
Have consents been obtained from models and members of the
public for photographs or images of them, their name or other aspects of their personality to be included in the advertisement? Have parental consents been obtained for children?
Does the advertisement potentially violate anyone's right
to protection of their private and family life, home and correspondence – e.g. does it refer to an individual's health, personal relationships or finances?
The laws of confidentiality, privacy and data protection may
Company trading disclosures 22
Competition law 22
Consumer credit 22
Distance selling 23
Financial services 24 Lotteries, prize competitions and similar promotions 24
Medicinal claims 25
Olympics and major sporting events 26 Premium rate numbers 27
Product placement 28
Social media, user-generated content, astroturfing and viral advertising
29
Ticket promotions 30
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Specific areas
Company trading disclosures
Does the advertisement comply with the Companies (Trading
Disclosures) Regulations 2008?
For example, certain business communications (e.g. a company’s
website) must contain particular information such as the company’s full registered name.
Competition law
Does the advertisement promote a scheme which is
anti-competitive?
Does the advertisement make any claims about the company
or its products that might attract the interest of a competition authority, for example a claim that the company has a strong or dominant market position, or that its products are unique?
Consumer
credit
Is the possibility of any credit, e.g. payment by instalments,
mentioned?
Does the advertisement comply with the Consumer Credit Act,
the Consumer Credit Advertising Regulations and the Consumer Protection from Unfair Trading Regulations 2008? Breach of certain provisions of the Consumer Credit Act is a criminal offence.
Distance selling
The Distance Selling Regulations apply to non face-to-face sales
such as by telephone, email, fax, mail order or SMS or via the internet.
Has the information required by the Regulations been provided
to the customer before the contract has been entered into? For example, has clear information been given in writing about the goods or services offered, delivery arrangements, payment, the supplier's details and the consumer's cancellation right before they buy?
If financial services are being sold at a distance, have the
Financial Services (Distance Marketing) Regulations 2004 been complied with?
The Electronic Commerce (EC Directive) Regulations 2002 and
the Companies (Trading Disclosures) Regulations 2008 have additional information requirements relating to websites and other sales channels.
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Specific areas
Financial
services
Is the advertisement a financial promotion prohibited by s.21 of
the Financial Services and Markets Act 2000? For example, does it contain an invitation or inducement to engage in investment activities, such as buying or selling investments, mortgages or insurance, or to participate in an investment service like an investment advisory or management service?
If so, unless an exemption applies, the advertisement must be
communicated by an FSA regulated firm or formally approved by such a firm. In either case, the advertisement will need to comply with detailed FSA rules.
Lotteries, prize competitions and similar
promotions
Does the promotion or advertisement involve a lottery or prize
competition?
For example, are prizes awarded for anything? Is a purchase/payment necessary to participate?
If so, check lottery and prize competition law, in particular the
Gambling Act 2005.
Is the advertiser able to source and supply the prizes as
Medicinal claims
Products are categorised as medicinal either by function or
by presentation (e.g. through advertising claims). If a product is classified as a medicine, its advertising is regulated by the Medicines and Healthcare Products Regulatory Agency (MHRA).
For prescription only medicines, direct to consumer advertising is
prohibited by law.
Marketing Authorisation Holders for a medicine are responsible
for ensuring advertisements for that medicine comply with Codes of Practice issued by the Association for British Pharmaceutical Industries (ABPI) and the Pharmaceutical Association of Great Britain (PAGB) Code of Practice for Health Professionals.
For example, advertising of a medicinal product:
›is not permitted before that medicine has a valid marketing authorisation in the UK;
›must be in accordance with the terms of its marketing authorisation and not inconsistent with the details in its Summary of Product Characteristics (SmPC);
›must not exaggerate the properties of a medicine or encourage its use other than in a rational manner; and
›must not mislead as to the potential benefits or possible risks of the medicine.
Cosmetics and food supplements may be classified as medicines. Specialist advice should be sought.
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Specific areas
Olympics and major sporting events
Does the advertisement refer to a major sporting event such
as the Olympics? There may be specific legislation in place to combat "ambush marketing" (e.g. the London Olympic Games and Paralympic Games Act 2006).
Is there any reference to, or association with, an Olympic event,
the Olympic word or motto, the Olympic ring symbol or the London 2012 logo (or similar)? Use of combinations of words that indirectly refer to the London Olympics, such as "Games 2012", may also infringe. For example, use of two of the words in Group 1 below, or any word in Group 1 with any of the words in Group 2, may give rise to liability.
Restrictions also apply to the use of current and former
Olympians in advertising.
Group 1
Group 2
Games Gold, silver, bronze 2012 London
Twenty Twelve Medals Two Thousand and Twelve Sponsor
Summer
An advertisement making any link or association with the
Olympics may give rise to civil and criminal liability, punishable by a fine of up to £20,000.
Premium rate numbers
Does the advertisement include the use of a premium rate
number (e.g. 0901, etc)?
If so, does it and the associated service comply with the
PhonepayPlus Code of Practice?
Has the advertiser ensured that all callers have an opportunity
to participate in respect of the advertised offer?
Registration with PhonepayPlus may be required depending
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Specific areas
Product placement
Product placement is where an advertiser pays a producer or
broadcaster to have its products, services or brands appear within a television programme.
Product placement is allowed only on certain UK commercial
television channels and in certain films, series, entertainment and sports programmes. Detailed rules apply as to what products can be placed and where – for example:
›no product placement is allowed on BBC1, 2, 3 and 4;
›no product placement is allowed in news or children's programmes;
›where the programme is made for UK television, the ban extends to religious, current affairs and consumer shows; and
›some products, e.g. tobacco, alcoholic drinks and prescribed medicines, cannot be placed in any programme.
Product placement must be signalled by a mandatory “P” logo at
specific times.
Social media, user-generated content,
astroturfing and viral advertising
Is the advertiser and/or promoter asking the public to submit
content, such as photos, video or comments, for uploading onto a company's website or microsite? Is the advertiser inviting or encouraging the public to create or distribute advertisements on behalf of the company? If so, the company could potentially be liable for the users' content or actions.
Liability may depend on whether the advertiser pre-vets or
moderates the user-generated content, and the extent of the advertiser's knowledge and reasonable care.
Is the company (whether directly or indirectly) anonymously
posting or blogging positive user reviews about its own products or negative ones about a competitor's? This may be astroturfing – see page 9.
If the company is adopting or incorporating user-generated
content to promote itself, then advertising laws and regulation (including ASA regulations on testimonials) may apply.
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Specific areas
Ticket promotions
The resale or provision of tickets to sporting events may be
prohibited by legislation or by the terms and conditions of the tickets themselves. Even if the intention is to give tickets away for free as competition prizes or for other promotional purposes, there may still be restrictions.
Providing tickets for Premiership football matches and the
Olympics without the appropriate authorisation is a criminal offence.
Dealing with intellectual property ownership and rights 32
Types of media 32
Other jurisdictions / internet 32
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Practical issues
Dealing with intellectual property ownership
and rights
Has the work been created already or is it being commissioned
for the advertisement? If the latter, have all the rights been properly assigned or licensed to the advertiser?
There are different ways to license in or acquire third party IP
rights for use in advertising e.g. buyout, exclusive licence and non-exclusive licence. Which is the most appropriate?
Types of media
Different rules and practices apply to different types of media,
e.g. magazines, bill boards, cinema, television, interactive television, radio, internet, email, SMS, post, telephone and fax.
Other jurisdictions / internet
Will the advertisement be seen outside England and Wales? If
so, other laws may apply.
Internet advertising may often have to comply with the law of
Advertising, intellectual property and media law
Competition
Robert Vidal Partner +44 (0)20 7300 4680 r.vidal@taylorwessing.comConsumer credit
Andrew Seager Senior Associate +44 (0)20 7300 4603 a.seager@taylorwessing.com Charles Lloyd Partner +44 (0)20 7300 4806 c.lloyd@taylorwessing.com Timothy Pinto Special Counsel +44 (0)20 7300 4287 t.pinto@taylorwessing.com Adam Rendle Associate +44 (0)20 7300 4787 a.rendle@taylorwessing.com Niri Shan Partner +44 (0)20 7300 4782 n.shan@taylorwessing.com Nick Cody Senior Associate +44 (0)20 7300 4845 n.cody@taylorwessing.com Mark Dennis Associate +44 (0)20 7300 4107 m.dennis@taylorwessing.com Justine Wilkie Associate +44 (0)20 7300 7155 j.wilkie@taylorwessing.com<< Contents 34 | Contacts
Medicinal claims
Tim Worden Partner +44 (0)1223 446 429 t.worden@taylorwessing.comDistance selling
Christopher Jeffery Partner +44 (0)20 7300 4230 c.jeffery@taylorwessing.comTV, film and radio
Tony Ghee Partner +44 (0)20 7300 4238 a.ghee@taylorwessing.com
Data protection
Sally Annereau Data Protection Analyst +44 (0)20 7300 4994 s.annereau@taylorwessing.comPremium rate numbers
Patrick Clark Partner +44 (0)20 7300 4923 p.clark@taylorwessing.com
Financial services
Jonathan Rogers Partner +44 (0)20 7300 4797 jonathan.rogers@taylorwessing.comwww.taylorwessing.com
© Taylor Wessing LLP 2013
This publication is intended for general public guidance and to highlight issues. It is not intended to apply to specific circumstances or to constitute legal advice. Taylor Wessing’s international offices operate as
