Despite the strength of the internet where advertising is rife, television advertising has remained constant. The emergence of digital advertising has not diminished the television’s enduring appeal to advertisers.
At EU level, television advertising has been for years strictly regulated. The Audiovisual Media Services directive harmonised audiovisual commercial communications across EU member states and makes television advertising subject to minimum rules and standards.
Primarily, it regulated television advertising by setting an EU wide maximum of admissible advertising per hour in the form of a limit of 20 per cent of television advertising and teleshopping spots per hour. The directive also established identification rules whereby advertising and editorial content must be kept distinct through optical, acoustic or spatial means. In addition, transmission of films made for television but excluding series, serials and documentaries could be interrupted by television advertising or teleshopping, on condition that the interruption only takes place once for a period of 30 minutes.
These rules were intended to establish a balanced protection of the interests of consumers as television viewers and the financial interest of television broadcasters and advertisers.
The Court of Justice of the European Union recently ruled on the interpretation of the provisions of this directive.
The case arose following certain broadcasting practices implemented by a Finnish television broadcaster, which the Finnish Communications Regulatory Authority considered illegal. The Finnish broadcaster split the television screen into two parts at the end of its programmes: one displaying the preceding programmes’ closing credits and the other one presenting the upcoming programme.
The authority considered that this did not constitute adequate separation of the programme from the advertising break. Furthermore, the broadcaster was airing advertising in excess of the hourly maximum duration of 12 minutes. This calculation included, within the definition of advertising time, sponsor logos displayed outside of the sponsored programmes and the fact that no ‘black seconds’ breaks were included between advertising spots.
The broadcaster challenged the decision of the Finnish media regulator and took the matter to the local courts, which in turn referred the case to the CJEU. The ruling given by the Luxembourg court provides some welcome guidance on the interpretation of the current Audiovisual Media Services directive.
In relation to the split screen method used by the Finnish broadcaster, the CJEU held that this was a legitimate practice in line with the directive, which requires television advertising to be kept distinct from editorial content, but does not prevent technical variations so long as the means of separation used allows consumers to differentiate between advertising and editorial content. The court deemed that the split screen method was capable of acting as separation between the programme and subsequent advertising break.
The CJEU also clarified the directive’s rules on the duration of advertising permissible in between content. The court held that black seconds breaks inserted between advertising spots or between an advertising break and the programme that follows are to be considered as advertising for the purpose of calculating the hourly maximum allowed under the directive. While sponsorship announcements within the framework of a sponsored programme placed before, during or after the sponsored programme are not included in the maximum hourly advertising, any sponsor logos outside that framework are considered as advertising for the purpose of the hourly maximum.
The directive is currently under review. A new legislative proposal adopted by the European Commission in May is based on the principle of minimum harmonisation, with EU member states allowed to adopt stricter rules. While the proposals maintain the strict 20 per cent limit on advertising time, the proposal gives broadcasters more flexibility as to when ads can be shown. In fact, the hourly limit is set to be replaced by a daily limit of 20 per cent of advertising between 7am and 11pm.
The proposal allows more flexibility in putting product placement and sponsorship announcements since these will not fall within the daily threshold set for advertising.
It remains to be seen whether the European Parliament and the Council will adopt the legislative proposal of the Commission.
jgrech@demarcoassociates.com
Dr Josette Grech is adviser on EU law at Guido de Marco & Associates.