In principle, advertisers are bound by the code of conduct set out by the International Chamber of Commerce, but electronic communications is outgrowing current regulation and raising important questions regarding advertising and consumer rights in the online world.
The EU consumer policy strategy 2007-2013 foresees that "the technological revolution brought about by the Internet" is paving the way for innovative ways to advertise goods and services, but concedes that the same revolution also presents challenges to self-regulation of advertising.
Advertisers have unsurprisingly preferred a self-regulatory approach to their work. A report from the European Advertising Standards Alliance (EASA) outlines how advertisers regulate themselves.
The EASA argues that good self-regulation builds up greater trust between the consumer and the industry. The EASA represents Europe's advertising industry by bringing together national self-regulatory organisations, or SROs, at European level.
National SROs, which exist in 22 of the 27 member states, differ slightly from country to country, primarily according to legal and cultural differences between EU member states, but all have the same goal of making sure that advertising standards remain within an acceptable boundary.
The EU agrees in principle that advertisers should self-regulate but since the 80s, issues of consumer health, fairness and privacy, in large part driven by the evolution of borderless satellite and digital technologies, have seen the EU draft stricter advertising codes for the industry.
Tobacco first to go
The EU hit out hardest at tobacco advertising with a strict no-tolerance policy on all media (EURACTIV 28/07/05).
The Tobacco Advertising Directive, adopted in May 2003 and ready for implementation in 2005, effectively banned tobacco advertising in print, radio, broadcast media and its internet equivalents. It also forbids tobacco sponsorships of cross-border events and activities.
The only member state to contest the tobacco directive was Germany whose appeal to the European Court of Justice for a partial annulment was dismissed in 2006 (EURACTIV 15/06/06).
Airlines in the spotlight
The EU executive launched its first 'ticket sweep' in September 2007 to check that 386 websites selling airline tickets were complying with European consumer protection laws. Airlines were given four months to remove misleading information on flight prices and conditions from their internet pages (EURACTIV 15/05/09).
The report showed that 137 of the 386 websites investigated were in blatant breach of EU consumer law, with misleading price advertising the most common offence.
After a second on-the-spot check of 67 major airlines carried out in March 2009, 52 were either give a clean bill of health or took clear steps to correct the ambiguities.
Ryanair, EasyJet, Wizzair, Austrian Airlines, LOT and Lufthansa were singled out as operators with outstanding problems.
Advertising to children
A voluntary pledge to change food and beverage advertising on TV, print and internet to children under the age of 12.was taken by Burger King, Coca-Cola, Danone, Ferrero, General Mills, Kellogg, Kraft, Mars, Nestlé, PepsiCo and Unilever in 2008.
However consumer groups continue to rally the Swedish presidency to push for stricter rules on food and drinks advertising targeted at children.
The pan-European consumer group, BEUC want to ban the advertising of food and drink high in fat, sugar or salt to children from 6-9pm and to extend such restrictions to all forms of marketing such as viral online campaigns and text messages.
Consumer groups have also been calling for colour-coded nutrition labeling on food sold across the EU.
In 2006 a stakeholder group chaired by the consumers group BEUC concluded that "the proliferation of many different simplified labelling schemes is a cause of unnecessary confusion."
In early 2008 the EU proposed a new regulation on nutritional information to consumers in order to simplify regulation, make it more efficient and provide more information. The proposal suggested mandatory nutrition labeling and minimum standards to improve legibility and origin declaration.
In response to the European Commission’s Proposal for a Regulation on the Provision of Food Information to Consumers, the European Public Health Alliance recommended a mandatory European labeling scheme on the front and back of food packaging, with a traffic light system explaining which food group – fats or proteins – each colour denotes.
However food manufacturers and retailers immediately expressed serious concerns over the proposal, describing it as "unworkable" (EURACTIV 31/01/08). The proposal is currently being reviewed by the European Parliament and may be adopted by 2010.
Advertising and new media
As the crash in global financial markets had a devastating effect on print advertising and the industries dependent on it, the online market for advertising continued to boom with the uncontested popularity of the internet. Search-related advertising and classified ads drove the boom according to data from the Interactive Advertising Bureau Europe (IAB).
As advertisers migrate to the Web, advertising standards have attracted attention. The internet has also blurred the lines on the definitions of advertising. In 2008 negotiations between the EASA, advertising agencies, associations and national self-regulatory organisations produced a Digital Marketing Communications Best Practice guidebook which is intended to define what kind of online content falls under the agreed advertising codes.
But EU lawmakers and consumer groups continue to question whether these rules are robust and transparent enough to address consumer protection issues that arise in the online sphere.
The lack of harmonised rules in advertising means that an image or a product that would be acceptable in one member state may be unacceptable to a user accessing the internet in another member state.
The Commission launched the European Consumer Summit in 2009 inviting leading industry figures to participate in a consultation on consumer protection and privacy in relation to online advertising in Europe in April 2009.
A particular concern raised at the summit was behavioural advertising which involves building a profile of information about users based on which websites they visit helping ad companies display advertisements that are more narrowly targeted to the interests of individual users.
The Commission's proposed Directive on Information to Patients attempts to set down rules on providing online information on medicines (EURACTIV 18/2/09).
To clarify information, the Commission calls for advertising of prescription medicines to be scrapped and wants to introduce stricter rules regarding the content of pharmaceutical adverts, including those on the Internet, in the form of an EU code of conduct.