Self-regulation of non-broadcast advertising

Self-regulation means that the industry has voluntarily established and paid for its own regulation.

The system works because it is powered and driven by a sense of corporate social responsibility amongst the advertising industry. Advertisers have an interest in maintaining the system because:

• Making sure that consumers are not misled, harmed or offended by ads helps to maintain consumer confidence in advertising. Advertising that is welcomed by consumers is good for business.
• It maintains a level playing field amongst businesses. It is important to the rules of fair competition that all advertisers play to the same rules.
• Maintaining the self-regulatory system is much more cost-effective for advertisers than paying the legal costs of a court case.

The role of the industry is to write the Advertising Codes, help advertisers to comply with the rules and to pay for the system.

However, the industry does not administer its own rules. It has established the Advertising Standards Authority (ASA) as the independent adjudicator.

Advertising self-regulation is flexible in its scope and is able to adapt to market conditions. This is particularly important in the fast-moving advertising industry.

The Code reflects requirements in law, but also contains many rules that are not required by law at all. The advertising industry has chosen to exercise this self-restraint not only to make further legislation unnecessary, but also as a public demonstration of its commitment to high standards in advertising.

Because the system works successfully, the UK Government has not needed to regulate directly. Of course, politicians, civil society and industry are all key stakeholders to the system and we actively seek out their views on our work.

Interaction with the law

Across the European Union (EU) there is a unified piece of consumer protection legislation to prevent the use of misleading or unfair trading practices. This law, called the Unfair Commercial Practices Directive, has been translated into UK law to make sure that we have the same rules as all the other countries in the EU.

The ASA works within this legal framework to make sure that UK advertising is not misleading or unfair. The ASA is able to refer advertisers who refuse to work with us and persistently make misleading claims to the Office of Fair Trading (OFT) for legal action. The OFT is able to act under the Consumer Protection from Unfair Trading Regulations 2008, which governs how businesses interact with consumers and the Business Protection from Misleading Marketing Regulations 2008, which govern how businesses advertise to each other.

The ASA is considered the ‘established means’ for gaining compliance with both these pieces of legislation. This means that the law itself is not usually enforced formally through the courts; instead the ASA is first allowed to tackle any problems under the Advertising Codes. This approach works well in the overwhelming majority of cases. The ASA is able to take action quickly and this avoids clogging up our court system.

Referral is rarely necessary, as most advertisers prefer to work with the self-regulatory system. Since 2000 around thirty advertisers have been referred to the OFT; in the same period the ASA has dealt with around 200,000 complaints.