SO WHO’S AFRAID OF THE ADVERTISING STANDARDS AUTHORITY – BUT WHAT ABOUT THE CONSUMER PROTECTION ACT?

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SO WHO’S AFRAID OF THE ADVERTISING STANDARDS AUTHORITY – BUT WHAT ABOUT THE CONSUMER PROTECTION ACT?

 

South Africans all know about the Advertising Standards Authority (the ASA) and the big stick that it wields against communication agencies and their clients.  But really, is anyone all that worried?  The best (or worst) that may happen to an offending advert is that the advert will not be published in any form, be it TV, radio or print media that is controlled by any member of the ASA.   No mess, no fuss, no fines, and everyone goes back to doing what they do best.

The playing fields are however set to change dramatically with the introduction of the Consumer Protection Act (the CPA) on 1 April 2011, which will transform the way in which each and every business in South Africa markets and sells its products or services.  The advertising industry is one of the main targets of this legislation and the impact of the CPA will be far-reaching, both legally and financially.

Recent complaints filed with the ASA against Game stores (a subsidiary of Massmart Holdings) and MTN for “misleading” advertising, may have had very different repercussions for each of the companies had the complaints been filed and decided in terms of the CPA.

Game received a caution from the ASA against what is known as “bait marketing”, for advertising a laptop on promotion and then being unable to service the demand, claiming the defence of the phrase “while stocks last” appearing in its advertising.  The ASA warned that advertisers should not offer goods or services if they could not reasonably expect to service the demand.

MTN was recently ordered by the ASA to withdraw its advert offering “world-class internet on your Smartphone”, which was held to be “misleading” as  independent research had in fact showed that MTN was the second slowest service provider in the country, and hence could not claim to offer services of “world-class” quality.

The CPA prohibits the marketing or advertisement of goods in any way that would be likely to create a false or misleading impression of the goods.  In the future, adverts of this nature may not only attract the displeasure of the ASA, but may also very well face the wrath of the nation’s courts, which have the power to impose any number of penalties, including substantial fines, orders discontinuing product lines or services or even imprisonment!

In 2009, the ASA received a total of 2095 complaints, with only 406 of these warranting formal investigation.  The vast majority of complaints were filed by consumers (1979) compared to the 116 filed by competitors and of heard, the ASA upheld 31% of consumer complaints and 25% of competitor complaints.

The introduction of the CPA is likely to see advertising complaints, particularly those by consumers, sky-rocket.  Not only the ASA is likely to feel this surge, but the various bodies tasked with hearing complaints in terms of the CPA, such as the Consumer Tribunal, The Consumer Commission, the Ombudsman, the Consumer Court, or the relevant Magistrate or High Court, where appropriate.

Whilst the ASA has, in the past, provided a measure of relief to those affronted by various forms of advertising, the CPA extends this relief by providing for hefty fines and other sanctions.  Brand owners and their communication agencies will therefore need to work closely with their clients to ensure that the products, promises, packaging and advertising are all in order, so as to avoid the potentially devastating consequences.

Publication Name: ASA

Date: July, 2013

Practice Area: Advertising Standards Authority

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