12 November 2002
This submission contians important background information to the Advertising Standards Authority of South Africa (ASA). It deals with the extent to which the ASA has transformed itself in recent years and sets out its vision for the future.
1.1 What is advertising self-regulation
1.2 Self-regulation and the Law
1.3 Role and Relevance
1.4 Compliance with international standards and best practice
1.5 Services to the public and the industry
1.6 Funding of the ASA
1.7 Membership of the ASA
1.8 Statutory recognition of the ASA
2.1 The Process of Transformation
2.3 The Code of Advertising Practice
2.4 Public participation in decision making
2.5 Interpreting the Code
2.7 Informing consumers of their rights
2.8 Public reporting
2.11 Co-operation with Government, Statutory and Consumer bodies
2.12 Industry sensitisation
2.13 Staffing policy
The effectiveness and hence the value of advertising as an economic tool are directly related to its standing in the eyes of the consumer. In order to fulfill its persuasive and informative task, advertising must enjoy a high level of consumer trust and confidence. If consumers are misled by advertising they will not buy again; if offended, they are unlikely to buy in the first place. It is in the longer-term interest of all those in the advertising industry, whether they be advertisers, advertising agencies or the media, to ensure the protection of the freedom of commercial speech by upholding its probity.
The need for consumer protection and high ethical standards is recognised by the advertising industry throughout Western Europe and in many other countries, where the industry actively participates in its own regulation. This process is called self-regulation; and its underlying principles are always the same:
- that advertising should be legal, decent, honest and truthful;
- prepared with a sense of social responsibility to the consumer and society; and
- with proper respect for the rules of fair competition.
This is achieved by means of rules or principles of best practice, by which the advertising industry voluntarily agrees to be bound. The rules are applied by self-regulatory organisations (SROs) set up for this purpose and funded by the advertising industry itself. The aim is to ensure high standards in advertising and thus to maintain consumer trust and confidence, to the benefit of all concerned.
The term self-regulation is potentially misleading, because at first sight it may suggest little more than voluntarily self-restraint on the part of an individual advertiser or agency. If self-regulation were indeed nothing more than this, it would deserve the lack of confidence sometimes expressed by those who are unfamiliar with it. In reality, properly designed and well administered self-regulatory systems provide a swift, flexible, inexpensive and effective means of enabling the responsible majority of the industry to restrain the irresponsible minority whose activities might otherwise bring advertising into public disrepute.
It is now generally accepted that self-regulation works best within a framework of statute law, to define broad principles and to act as a 'last stop' in cases where all else has failed. In handling the detail of advertising content, particularly those 'important trivia' which matter very much to consumers, self-regulation has advantages of speed, flexibility and cheapness which detailed legislation cannot equal. The law and self-regulation complement each other, rather like the frame and strings of a tennis-racquet, to produce a result which neither could fully achieve alone.
The statutory framework within which the ASA in South Africa operates is set out in Annexure 1.
The ASA of South Africa is an independent body, put in place to protect the public interest and to resolve disputes in the marketing communications industry. Its task is to facilitate the setting of standards and to uphold the Code of Advertising Practice in an impartial and objective manner.
For the general public the ASA is the national body to which they can complain when advertising is unacceptable.
For official agencies and statutory bodies the ASA is a source of information and assistance in the realm of marketing communication. Rather than liaise with dozens of groups, officials can consult a single, authoritative independent body that is in touch with industry and public sentiment.
For consumer and special interest groups the ASA is a responsive communication channel, taking their concerns to the entire marketing and media sector.
- For media and marketing companies the ASA is a fast and an affordable means of resolving disputes, whether the complaints are from fellow marketers or consumers.
With globalization and cross border advertising campaigns the harmonization of advertising standards and best practice has become increasingly important in a global marketplace. For an international company seeking to invest in South Africa the assurance that South Africa complies with international standards and best practice is of prime importance.
In 1995 the ASA was granted membership of the European Advertising Standards Alliance. Members of the Alliance include:
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As a member of the Alliance South Africa has to comply with a set of common principles and standards of best practice. The principles which underpin every self-regulatory body in membership of the Alliance are:
The consumer benefits
The purpose of a self-regulatory system is to maintain consumer confidence in advertising by offering a rapid and effective response to consumer concerns. It facilitates consumer protection by providing a route for the individual consumer to express a view directly to the advertising business and the advertiser. It enables brands to compete on a level playing field to the benefit of the consumer. In all this, the advertising business will also be seen to be actively, continuously, and responsibly engaged with the consumer.
Self-regulatory systems should, above all, ensure that the individual consumer is the focus of attention.
Self-regulation must be and be seen to be impartial.
Operation and outcome/decisions of the self-regulatory systems should be made independently of government, specific interests and interest groups.
Transparency and accessibility
Access to the complaints process should be easy and at no cost to the consumer.
The right of a consumer to access the self-regulatory system and the means of doing so should be well known.
The workings and outcome/decisions of a self-regulatory system should be transparent to all parties.
Not withstanding the national legislative framework, self-regulation must be and seen to be effective, in both its operation and outcome.
Self-regulation must be rapid, flexible, current and applied in a non-bureaucratic manner.
Self-regulatory rules and procedures should be applied in both the spirit and the letter, and regularly reviewed.
Efficient Complaint Handling and Enforcement
A self-regulatory system should have a means to handle consumer complaints, which should be handled free of charge.
A self-regulatory system must have adequate and credible sanctions to support its decisions.
A self-regulatory system should have the power to enforce effectively its decisions, i.e. sufficient moral and practical support from the constituent parts of the advertising industry.
Self-regulation and the Law
Self-regulation must always be in compliance with the law, and no part of the self-regulatory process should deprive a consumer of the protection provided by the law.
Self-regulatory systems and bodies in membership of the EASA have a duty to co-operate with each other in order to handle complaints effectively and converge on best practice.
Self-regulatory systems must be sufficiently resourced and supported to be able to meet their objectives.
Industry members should ensure adequate moral and financial support for advertising self-regulation and its implementing organisations.
The primary service offered by the ASA is to the South African public. This service is offered free of charge and over 80% of complaints received by the ASA emanate from the public or from bodies representing the public interest.
In keeping with the trend towards alternative dispute resolution the ASA also offers competitors a forum to resolve disputes relating to the content of advertising. During 2001 the ASA investigated and resolved 147 disputes between competitors, both local and international. A charge system for complaints lodged by commercial entities apply. At the request of marketers, the ASA also offers a dispute resolution facility to resolve sponsorship disputes within the industry.
Competitor complaints account for approximately 20% of the overall number of complaints received.
The advertising regulatory system, in keeping with international practice, is funded entirely by the marketing communications industry. A levy is placed on all advertising and the proceeds are placed in a trust. Money from the trust finances the ASA. ASA decisions can therefore not be influenced by the 'power of the purse' of large advertisers or any industry group. This method of funding preserves the integrity of the system.
The following industry bodies as well as their members have voluntarily agreed to be bound by the Code of Advertising Practice as well as by the rulings made by the ASA:
- Association for Communication and Advertising
- Association of Unit Trust
- Cosmetic Toiletry & Fragrance Association
- Direct Marketing Federation
- Franchise Association
- Furniture Trader's Association
- Health Products Association
- Industry Association of Responsible Alcohol Use
- Information Technology Association
- Hospital Association
- Marketing Federation of Southern Africa
- Namibia Broadcasting Corporation
- National Association of Broadcasters
- Outdoor Advertising Association
- Pet Food Institute
- Pharmaceutical Manufacturers' Association
- Print Media SA
- Printing Industries Federation
- Retail Motor Industry Organisation
- SA Optometric Association
- Sales Promotion & Design
- Self-Medication Association
- Timeshare Institute
The Independent Broadcasting Authority Act recognises the ASA Code as the standard that all broadcast advertising has to comply with, thus giving the Code statutory recognition. All advertising on electronic broadcast media is subject to the Independent Broadcasting Authority Act. In terms of this Act all electronic broadcasters must adhere to the ASA Code as determined and administered by the ASA.
This statutory framework created for broadcasters has proven to be extremely effective without detracting from the benefits of speed, cost and effectiveness self-regulation offers.
The ASA, as a body dealing with human rights and charged with the responsibility of acting in the public interest, embarked on a process of transformation in the early nineties when a human rights culture started to develop in South Africa.
At the time:
- The Code was completely rewritten to conform to the Interim Constitution
- Representation was re-looked and extended
- Consumers were afforded the right to representation
- Summaries of findings were published
- Hearings were opened up to the media
- International ties were established and the ASA started acting in accordance with international standards and best practice and gained membership of the European Advertising Standards Alliance
- Procedures, staffing policies and structures were re-looked and adapted.
In 1999 that process gained momentum when a Strategic Review was conducted to ensure that the ASA was "structured and directed to fulfil its role in a new society".
The decisions taken during the Strategic Review were approved by all Constituent members and were subsequently implemented.
Independence was identified as a key factor in ensuring the credibility of the regulatory system.
The ASA has an independent President, an independent Chairperson of the Board and independent Chairpersons of the various decision making committees.
The President of the ASA is Mr Mervyn King S.C., a former Supreme Court Judge and Chairman of the King Committee on Corporate Governance.
Independent Chairperson of the ASA
Dr Danisa Baloyi is the Chairperson of the ASA Board. Dr Baloyi is a director of various boards in South Africa and chairs the Gauteng Tender Board, Tourism Business Council of South African and the South African Entrepeneurship and Small Business Association. Dr Baloyi obtained a Doctorate in Education from Columbia University and in addition to her many other activities, acts as a business consultant for Deloitte & Touche.
Independent Chairperson - Advertising Standards Committee
Brian Leveson, a nominee of the Consumer Institute of South Africa, was appointed as the Independent Chairperson of the Advertising Standards Committee. As an attorney Brian practised in the Human Rights arena for 9 years. He was responsible for the establishment of the Housing Advice Project of the Legal Aid Bureau and the Housing Rights Unit of Lawyers for Human Rights. He also played a major role in the establishment of the Housing Consumer Protection Trust.
Independent Vice-Chair - Advertising Standards Committee
Adv Gcina Malindi is the Vice-Chair of the Advertising Standards Committee. His experience includes acting as Counsel to the Commission of Enquiry into the affairs of the University of Durban Westville and serving as a member of the Ministerial Task Team into the affairs of rugby and the South African Rugby Football Union. He is a member of the Johannesburg Bar Council and served on the professional Committee of the National Association of Democratic Lawyers.
Independent Chairperson - Advertising Industry Tribunal
Sara Gon is the Chairperson of the Advertising Industry Tribunal. Sara is an attorney with a special interest in industrial relations and labour law matters. She serves on the panel of the Arbitration and Mediation Service of South Africa and sat as an acting judge in the Labour Court as well as an assessor in the labour Appeal Court on numerous occasions.
The South African Code is based on the principles contained in the International Code of Advertising Practice prepared by the International Chamber of Commerce. This Code forms the basis of all self-regulatory systems. With widely differing legislation in different countries, the ICC Code serves to harmonise ethical principles in a global marketplace.
The content of the SA Code is fully in line with the South African Constitution. It requires human rights to be respected and covers particular sensitivities in South African society while providing for democratic freedoms to be observed. Discrimination, gender issues and children's rights are all covered.
The basic principles contained in the Code can be summarised as follows:
- Stay within the law
- Don't lie - substantiate claims
- Don't mislead
- Don't knock
- Compare fairly
- Be responsible
- Don't offend
- Don't steal
- Don't exploit the vulnerable
- Consider your neighbour
The Code of Advertising Practice is revised annually to keep pace with social and economic change. This process starts in November each year when the industry and the South African public are called upon to propose changes to the Code. The Code Revision Committee is chaired by Dr Danisa Baloyi, the independent Chairperson of the ASA Board.
When revising the Code in regard to children, many public submissions were received and incorporated into the Code. Furthermore, the ASA closely co-operated with the Commission on Gender Equality to include a section in the Code pertaining to gender issues.
The Advertising Standards Committee is responsible for considering complaints from consumers and setting the standard. It was therefore constituted to include representatives of all sectors of South African society.
Public bodies were approached to nominate representatives to serve on this Committee. The Committee now comprises 8 representatives nominated by the industry and 8 representatives nominated by bodies representing public and consumer interests.
The public representatives nominated to serve on this Committee are:
- Independent Chairperson - Brian Leveson
- Independent Vice-Chair - Adv Gcina Malindi
- Black Housewives League - Joyce Mavuka
- Commission on Gender Equality - Dr Sheila Meintjes
- Consumer Forum - Lulu Letlape
- FAMSA - Annette van Rensburg
- Institute for Democracy - Dumile Mzaidume
- SA Bureau of Standards - Dareth Baker
- SA National Consumer Union - Lillibeth Moolman
To assist Committee members in reaching decisions, independent expert opinions are obtained or experts co-opted onto the Committee eg. Association for the Blind, Liquefied Petroleum Gas Association of SA, SA Counsel of Churches, The Lesbian & Gay Equality Project, Human Rights Commission, etc. This ensures that the necessary knowledge or expertise is on hand when decisions are made.
Those who are bound by the Code, agree to observe it both in spirit and in the letter and not to circumvent it by dubious ingenuity. The Code is therefore applied in both the spirit and the letter.
In assessing an advertisement's conformity to the Code, the primary test applied is that of the probable impact of the advertisement as a whole upon those who are likely to see or hear it.
In a democracy every individual has the right to be heard. Any complaint which is reasonable and falls within the jurisdiction of the ASA, is therefore investigated. It is not the number of complaints but the validity of a complaint that determines whether the Code has been contravened. A single complaint about an advertisement which makes false claims or a complaint about claims in an advertisement which cannot be substantiated, is as valid as a thousand complaints.
In judging whether an advertisement is offensive to SA society it must be considered objectively from the viewpoint of the hypothetical viewer or listener. This fictional, reasonable person is the normal balanced right-thinking person who is neither hypercritical nor over sensitive. It is the task of the Advertising Standards Committee, which is as far as possible representative of a diverse and complex society, to finally determine whether an advertisement is likely to be viewed as offensive by the reasonable South African. When an advertisement is found to be offensive it is the end result of a democratic process. An individual or group of individuals with a particular viewpoint is in no position to make such a judgement.
The ASA is in a position to instruct an advertiser
- to amend an advertisement to conform to the Code of Advertising Practice
- to withdraw an advertisement
- to pre-clear the amendment of a specific advertisement
- to pre-clear all advertising for a specified period, normally 6 months, in the
- case of regular contraventions
- adverse publicity
- disciplinary action.
In 2001 the ASA identified a need to have a further powerful sanction to adequately deal with those who disregard the Code.
The ASA is now in a position to order an advertiser to publish a summarised version of an ASA ruling in the media in which the advertising appeared. The ASA is responsible for summarising the ruling and the advertiser is required to pay all production and media costs. This punitive sanction is a powerful deterrent to those advertisers who may consider breaching the Code.
To ensure enforcement of a ruling or sanction where an advertiser refuses to co-operate, an AD ALERT is issued to television, radio, newspapers, cinema, outdoor advertising and members of the Printing Industries Federation who will then not accept the advertising in question.
The ASA, recognising the need to inform consumers of their right to truthful and honest advertising, embarked on a communications campaign in 2001. The campaign includes:
- A television commercial
- A radio commercial in 9 languages
- A print advertisement
- A corporate brochure
- A website containing all ASA rulings
- An electronic Newsline
- Contact and co-operation with consumer offices in all provinces
- A user friendly summary of the Code for consumers.
During 2002 a summary of the Code of Advertising Practice was published and copies were distributed to Consumer Affairs Offices in all the provinces. This summary is being translated into various languages and will be printed as soon as funds are available.
The Sowetan has already agreed to publish the summarized Code to assist in educating consumers. Other media have been approached to do the same.
From January to September 2002 the communications campaign resulted in a 53% increase in complaints.
The ASA publishes an Annual Report, which is distributed to various stakeholders including national and provincial government, the media, the industry as well as consumer and public bodies.
In the Report information is given regarding the percentage of complaints received from consumers, competitors and bodies or organisations. The nature of complaints (top 12 categories), the services or product categories which drew complaints and the medium complained against, are also reported on.
Who complained: What % from consumers were male / female:
Industry complaints: agency/direct Outcome of complaints
Nature of complaints (Top 12 categories)
Services/product categories which drew complaints (Top 12)
Mediums complained against
The ASA system of self-regulation is free to the public and accessible to all. Where legal processes are expensive and can take years, the ASA is in a position to act fast and effectively and is often able to resolve a particular problem in a matter of days.
ASA hearings are open to the public and the media. Decisions taken by the ASA are published on the ASA's website. Refer www.asasa.org.za. Details of both the complaint and the response are given as well as the ASA's ruling. The full Code and a description of the system can also be viewed on the website. The website serves as a valuable source of information for consumer journalists, the public, and other interested parties such as Government.
The ASA co-operates on an on-going basis with government departments and statutory bodies including:
- The Department of Health
- The Medicines Control Council
- The Department of Agriculture
- The Road Safety Council
- The Consumer Affairs Committee (DTI)
- Department of Transport
- Department of Environmental Affairs
- SA Reserve Bank
- SA Revenue Services
- Water Affairs
- Independent Communications Authority of SA
- Commission on Gender Equality
- Human Rights Commission
The ASA has visited Consumer Affairs Offices in all the provinces, remains in close contact with them and participates in consumer exhibitions held at provincial level.
The ASA attempts to sensitise the industry in regard to various issues:
On 21 June 2001 the ASA held a Human and Consumer Rights seminar, bringing representatives of key constituencies into contact with advertising practitioners and media owners. Simultaneously industry delegates were exposed to trends shaping public discourse in the areas of human rights, gender, consumer and children's rights.
Mr Alec Erwin, Minister of Trade and Industry, was invited by the ASA to address the marketing communications industry on 5 September 2002. At this event he informed the industry of government's expectations when advertising to consumers.
An electronic Newsline is sent to advertisers, marketers and media owners every quarter to provide them with information and guidance in regard to the Code and its interpretation.
Lectures are regularly given at tertiary institutions serving the marketing communications industry as well as to advertising agencies and marketers.
To effectively serve a diverse and complex society the ASA has a policy of employing staff representing all sectors of society. Currently 66% of the management and professional staff at the ASA are black while 34% are white.
One of the ASA's principal concerns for the future remains the fact that for so long as it remains an entirely voluntary self-regulatory body its jurisdiction will be confined to those media owners and advertisers that submit to its jurisdiction, either through membership of the ASA or through membership of one of its constituent members.
There will be constant resistance to the ASA's actions from those who are affected thereby, but who by choice or circumstance fall outside of the ASA's jurisdiction.
The ASA has, for some time, recognised the desirability of a statutory framework within which it can continue to perform its self-regulatory role. Such a framework already exists in respect of broadcast media, which is subject to the ASA Code by application of the IBA Act. An extended statutory framework could make all advertisers, whether mainstream or informal, subject to the ASA's jurisdiction. Such a statutory framework could, in addition, give "teeth" to the ASA's sanctions, perhaps even by establishing that contraventions of such sanctions would be an offence.
Self-regulation within a statutory framework is common. It exists in man professions and trades in South Africa, and the fact that new industries, such as the micro-lending industry, have recently been subject to such a system seems to indicate that the current Government is in favour of the retention of statutory self-regulation.
In 2002 the ASA had at its disposal a total budget of R4,8 million. With a 53% increase in complaints during 2002, the minimum budget required for 2003 will be R5,9 million. Even with an increased budget, the ASA will require additional funding if it is to further inform the general public of their right to honest advertising and to deal with the resultant workload.
If statutory self-regulation were to be achieved, then the ambit of the ASA's activities would be expanded. This would, obviously, require an increase in the funds required to finance the ASA's activities. Whilst there is no reason why advertisers themselves should not be called on to fund competitor complaints, the issue of consumer complaints is more complex.
In keeping with international practice it would be ideal for the ASA to be entirely funded by the marketing communications industry. This would mean that the industry would voluntarily have to increase its contributions. In the current financial climate it is unlikely that this approach would receive a favourable response.
Other options should then be considered. One is to look to the state to provide funding within the statutory framework that has been mooted above. The second option is to provide within the statutory framework for a levy, the payment of which is compulsory, on all advertising. Yet further options could be explored.
It is proposed that the ASA engages with Government in a forum where all relevant stakeholders are represented to discuss statutory underpinning and to explore funding possibilities to best serve the interest of the South African public.
Acts Affecting Advertising
- First and foremost the Constitution of the Republic of South Africa Act 108 of 1996, and specifically sections 16 and 36, has an impact on advertising.
Following from the Constitution are the following Acts:
- Promotion of Access to Information Act 2 of 2000
- Promotion of Administrative Justice Act 3 of 2000
- Promotion of Equality and Prevention of Unfair Discrimination Act 4 of 2000
- The Independent Communications Authority of South Africa Act 13 of 2000, read together with the Independent Broadcasting Authority Act 153 of 1993, and specifically section 57 thereof, stipulates that all broadcasters must adhere to the Code of Advertising Practice as determined and administered by the ASA.
- The Consumer Affairs (Unfair Business Practices) Act 71 of 1998 includes advertising in the definition of a 'harmful business practice'. Accordingly, the Consumer Affairs Committee can investigate advertising practices and, inter alia, declare such practices as illegal.
- Advertising on Roads and Ribbon Development Act 21 of 1940
- Agricultural Product Standards Act 119 of 1990
- Attorneys Act 53 of 1979
- Banks Act 94 of 1990
- Boxing and Wrestling Control Act 39 of 1954
- Broadcasting Act 4 of 1999
- Child Care Act 74 of 1983
- Children's Act 33 of 1960
- Close Corporations Act 69 of 1984
- Companies Act 61 of 1973
- Competition Act 89 of 1998
- Copyright Act 98 of 1978
- Credit Agreements Act 75 of 1980
- Defence Act 44 of 1957
- Designs Act 195 of 1993
- Education Affairs Act 70 of 1988
- Electoral Act 73 of 1998
- Estate Agency Affairs Act 112 of 1976
- Fertilizers, Farm Feeds, Agricultural Remedies and Stock Remedies Act 36 of 1947
- Films and Publications Act 65 of 1996
- Financial Markets Control Act 55 of 1989
- Foodstuffs, Cosmetics and Disinfectants Act 54 of 1972
- Fund-raising Act 107 of 1978
- Hazardous Substances Act 15 of 1973
- Health Act 63 of 1977
- Health Professions Act 56 of 1974
- Heraldry Act 18 of 1962
- Housing Development Schemes for Retired Persons Act 65 of 1988
- Income Tax Act 58 of 1962
- Independent Media Commission Act 148 of 1993
- Liquor Act 27 of 1989
- Liquor Products Act 60 of 1989
- Livestock Improvement Act 25 of 1977
- Lotteries Act 57 of 1997
- Medicines and Related Substances Control Act 101 of 1965
- Merchandise Marks Act 17 of 1941
- Mutual Banks Act 124 of 1993
- National Gambling Act 33 of 1996
- National Road Safety Act 9 of 1972
- Nursing Act 50 of 1978
- Participation Bonds Act 55 of 1981
- Patents Act 57 of 1978
- Plant Improvement Act 53 of 1976
- Property Time-sharing Control Act 75 of 1983
- Referendums Act 108 of 1983
- Registration of Copyright in Cinematograph Films Act 62 of 1977
- Rental Housing Act 50 of 1999
- Road Transportation Act 74 of 1977
- Sale and Service Matters Act 25 of 1964
- Share Blocks Control Act 59 of 1980
- Societies for the Prevention of Cruelty to Animals Act 169 of 1993
- South African Medicines and Medical Devices Regulatory Authority Act 132 of 1998 (date of commencement: to be proclaimed)
- South African Reserve Bank Act 90 of 1989
- Standards Act 29 of 1993
- Stock Exchanges Control Act 1 of 1985
- The South African National Roads Agency Limited and National Roads Act 7 of 1998
- Tobacco Products Control Act 83 of 1993
- Advertising Standards Authority of South Africa (ASA)