What kinds of restrictions is advertising subject to?
The British Code of Advertising and Sales Promotion
applies to all adverts in Britain including those placed on the
Internet by UK advertisers. There are specific requirements for
distance selling advertisements and obligations on database owners.
In particular, UK law also imposes restrictions on advertising,
lotteries, gaming and betting in respect of certain classes of
One of the problems facing Internet companies is
the differing advertising and promotion regulations in different
countries. Ensuring compliance with all these would be an extensive
process, for example, in Germany "2 for 1" promotions are illegal.
As a result, it is important to decide which countries you are
targeting, establish whether the proposed advert or promotion is
acceptable in that country and then include a statement that the
site is only intended for access from those countries.
Comparative advertising using a third party’s
registered trade mark is permitted, however, it may lead to actions
of infringement or defamation if the comparison is contrary to
honest practices, takes unfair advantage or is detrimental to the
distinctive character or repute of the trade mark.
The Misleading Advertising Directive aims to
harmonise the laws across the EU relating to comparative
advertising. Advertisements must objectively compare one or more
material, relevant, verifiable and representative features.
Who can be liable for defamatory material on the
Under the Defamation Act 1996 an author, editor or
publisher may incur liability for defamation. An ISP will not be
considered an author, editor or publisher if it is only the
operator of or provider of access to communications systems by
means of which the statement is transmitted, or made available, by
a person over whom he has no effective control.
However, the ISP must have taken reasonable care to
prevent the publication of defamatory statements. In a recent case,
an ISP was found guilty of defamation in circumstances where it had
failed to remove defamatory statements from a Usenet News Group,
after having been informed of their existence. (Godfrey v Demon
Internet Ltd 1999). As a result, ISPs and site owners where, for
example, they invite comments to the website should act quickly to
remove any statements which are or are alleged to be
As a result of Godfrey v Demon (1999), an ISP shut
down a magazine for homosexuals for fear of being held liable for
defamation. However, the owner of the site is now bringing a legal
challenge to the European Court of Human Rights on the basis that
English libel laws breach the right to freedom of expression and
that ISPs should only be liable if it had knowledge that a
statement was both defamatory and untrue or had been recklessly
indifferent. This case has yet to reach the courts, however,
forthcoming legislation from Europe in the form of the e-commerce
and copyright directives appear to be taking a route which relieves
ISP's of liability provided that they are "mere conduits" of
information, not taking steps to check or review it. This will also
apply in cases of copyright infringement.
If you have any queries about these questions and
answers, please contact John Armstrong, Commercial Partner by