Tuesday 31 March 2020


ARB moving steadily along

It’s been roughly three years since the ASA in South Africa found itself in the public spotlight for management and legal issues that threatened its very existence. Gail Schimmel took the reign during that time and gradually resurrected the organization as the ARB. Truth be told, the ASA went into a painful rescue and subsequent liquidation and the ARB is a new regulatory body with a new website and business location. Essentially though, it functions as the ASA did.

As Covid-19 was, and is, dominating headlines, the ARB announced further changes this month, in its quiet re-emergence as the regulator for advertising and packaging complaints and disputes in South Africa. Stephen Kotze, another stalwart of the organisation, sent out a communication recently announcing that the Codes have been changed and should be consulted. 
The ARB published 9 decisions in 2018, over 150 in 2019 and there has been healthy activity in 2020. Most of the decisions are consumer complaints but there have been several competitor complaint rulings including by the Appeals Committee, indicating renewed trust and business confidence albeit not yet at the same levels as its predecessor, yet.
These changes outlined by Stephen in his email are: 
“Significant broad changes include:
·  The reference to “ASA” has been changed to “ARB” throughout, and the list of members in the preface has been updated;
·  All the Guidelines have been removed. This is because they were non-binding and had fallen out of use.
·  Large parts of Section III have been removed. Again, they had fallen out of use and reflected historical issues that are no longer relevant. It was felt that in so far as many sections were concerned, the issue was adequately regulated under Clause 4.2.1 of Section II which deals with misleading claims.
·  Appendix A (Alcohol) and Appendix B (Cosmetics) have been completely updated in line with the changes brought by their respective industry bodies.
·  Certain Appendixes have been removed, due to the relevant interest group no longer being involved in self-regulation and the area regulated no longer being a live issue.
·  The Procedural Guide has been tightened and rearranged to reflect actual procedures, and to read in a more logical manner.

Turning to specific areas of interest:
·  Clause 14 of Section III is an attempt to regulate the issue of potions, lotions and spells that are sold to vulnerable consumers. Readers are warned that compliance in this area is going to take time and education. The clause reads:
“14.1 Advertisements for products or treatments with unproven supernatural properties including those for achieving health, wealth or happiness should only appear in media where the following disclaimer clearly appears, legibly and boldly: The claims made [on this page/in this programme/ on this poster/ on this billboard] have not been scientifically proven. The advertised outcomes claimed are not guaranteed.
14.2 The onus for compliance with this clause lies both with the advertiser and the medium carrying the advertising.
14.3 The following media specific requirements apply:
• In the case of print, the disclaimer will appear in a frame around either the advertisement or the page that carries the advertisement.
• In the case of television, the disclaimer will appear on a clearly legible banner for the duration of the commercial.
• In the case of radio, the disclaimer must be read before the commercial.
• In the case of out-of-home, the disclaimer will appear along the bottom of the billboard or poster in a clearly legible format.
• In media that is not specified, the disclaimer must be applied in a reasonable manner that would ensure that the reasonable consumer is aware of it.” 
·  Also in Section III, we see a new provision for the telecommunications sector:
15.3 Any direct or indirect claims of Mobile Network superiority must be properly couched to ensure transparency and avoid ambiguity.
15.3.1 When parity or superiority is claimed or implied in relation to real-world network performance, certain mandatory criteria apply.   
15.3.2 when parity or superiority is claimed or implied in relation to subjective measures such as, inter alia, consumer preference, such claims should be phrased in a manner that provides instant clarity. Words such as “voted the best” or “most liked” are recommended for this purpose. Such claims would remain subject to substantiation as per Clause 4.1 of Section II of the Code.   
15.3.3 it will not be acceptable to provide clarity or context by means of body copy or disclaimers when the initial claim is not suitably qualified or contextualised.   
15.3.4 In the event that the entity relied on to substantiate such claims as contemplated in clauses 30.3.1 and 30.3.2 above issues a new report, affected advertisers must remove all redundant claims within the deadlines stipulated in the Code. The requirements of Clause 30.3.4 will not apply if the affected advertiser retains its position of superiority / parity in the newest report. 
·  In terms of Procedure, we need to highlight a major change to the time periods. Whereas before, in a Final Appeal, the Appellant had 20 days to appeal and the Respondent had 10 days to respond, both parties now have 20 days. The relevant change is to Clause 12.8 of the Procedural Guide.
·  Clause 7.3 of the Procedural Guide now offers important clarity: Nothing in this clause, or in Clause 3.3 of Section II, must be read as implying that the ARB may seek to enforce regulations or laws. This task falls on the relevant regulator. The ARB may only enforce the Code.
·  Clause 8.2.2 of the Procedural Guide now allows that ALL responses are due within 5 days. This is a change from 3 days for competitor matters, and 2 days for substantiation.
·  Clause 8.5.1 of the Procedural Guide now formally empowers the Directorate to “Attempt to resolve the matter between the parties without the need for a formal decision”.
·  In response to a spate of interlocutory procedures being invoked in recent matters, the following clauses have been added to the Procedural Guide:
9.13   While the parties are entitled to bring any interlocutory applications appropriate in order to enforce their rights, parties are reminded that self-regulation is, by its nature, intended to be quick, cheap and solution-driven. Parties who lodge interlocutory applications merely to frustrate the process are acting contrary to the spirit of the Code. Parties may, at the discretion of the Chair of the AAC or FAC, as relevant, be penalised for this behavior by forfeiting the refundable portion of their appeal fee.
9.14   Interlocutory decisions made by the Head of the Directorate or the Chair of the AAC are not appealable."

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