Annex B: Examples of co-regulation
A. Advertising Standards Authority
Forty years ago the Advertising Association established
the Committee of Advertising Practice (CAP), an industry body
to draw up a Code of Practice for advertisers, agencies and media.
In 1962 the industry established the Advertising Standards Authority
(ASA) under an independent Chairman, to adjudicate on complaints
about breaches of the Code. The stated aim was to ensure that
advertisements are 'legal, decent, honest and truthful'. The majority
of complaints are about misleading advertising. Under the self-regulatory
system advertisers have to be able to prove the claims they make
if challenged. In 2001 the ASA considered complaints about 10,527 advertisements, and formally investigated and upheld complaints about 652 of them. The Code bans any confusion of advertising with editorial material and with private correspondence.
The vast majority of advertising in the UK was said
now to comply with the Code. Self-regulation means that advertisements
that break the Codes can be withdrawn without resort to legal
bans. Advertisers who flout the rules can be denied access to
newspapers, magazines, poster sites, direct mail or the Internet.
CAP interprets ASA rulings to the industry and helps advertisers
to comply with the Codes through Copy Advice and Help Notes. Self-regulation
in this area is argued to be flexible in the light of new situations
or products. The Government has indicated that it considers the
self-regulatory system to be effective: "the success of self-regulation
is due to the hard work of many, including the ASA. But self-regulation
could not work without the active participation and commitment
of the advertising and publishing industries. The system also
has a high level of recognition from the public and is important
to consumer confidence in advertising" (Parliamentary Under-Secretary
of State, Department of Trade and Industry, 2003).
Since 1988, self-regulation have been backed up by
the Control of Misleading Advertisements Regulations. The ASA
can refer advertisers who refuse to co-operate with the self-regulatory
system to the Office of Fair Trading (OFT) for legal action (see
also Annex D). The OFT's role was mainly to support and reinforce
the controls exercised by other bodies where these have been unable
to take effective action. The OFT has stated that there are rare
instances where it would act unilaterally. Most complaints about
misleading advertisements are handled by the ASA and the trading
standards service (although the ITC, Radio Authority also have
a role as do some other agencies such as the Financial Services
Authority and the Medicines Control Agency, handling more specialized
advertising complaints). The Regulations also impose a statutory
duty on the Director General of Fair Trading to have regard to
the benefits of self-regulation in exercising functions defined
by them.
B. ICSTIS—Independent Committee for the
Supervision of Standards of Telephone Information Services
ICSTIS was an independent industry-funded regulator
responsible for the supervision of Premium Rate Services which
now operated across all forms of communications devices ranging
from fixed telephone services, mobile text services, certain Internet
services and more recently some of the interactive elements of
TV services such as some found on the Sky platform. The co-regulatory
model for supervising this sector appeared to be unique. ICSTIS
was supported by all UK telecoms operators and a Condition in
DTI network licenses underpinned this. The Communications Bill
would alter arrangements slightly with ICSTIS appearing on the
face of the Bill in Clauses 116-120. There was clear input from
all stakeholders when determining the Code after wide consultation.
The Code was then approved by the Director General of Oftel (soon
to be Ofcom). ICSTIS members were independent of the sector with
no direct interests as a condition of appointment. ICSTIS had
"teeth" in terms of its ability to apply sanctions to
providers of services who breached the Code. This ranged from
warnings to unlimited fines (the highest so far having been £100,000)
to a complete bar of the services in question. Like statutory
bodies, ICSTIS is a public body subject to Judicial Review and
has in place independent appeals mechanisms to ensure complete
compliance with the Human Rights Act, specifically the ECHR Article
Six provisions in relation to the right to a fair and impartial
tribunal hearing.
| 
