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Advertising on video-sharing platforms? Ofcom launches consultation on new proposals

Posted on 22 June 2021

Ofcom has published a consultation on proposals for the regulation of advertising on video-sharing platforms, a type of online video service where users can upload and share videos, including dedicated platforms such as YouTube, Vimeo and Twitch and websites which allow hosting such as Facebook, Instagram and Twitter (VSPs). Though primarily focused on the obligations of VSP providers, advertisers should also be aware of the proposed changes, to ensure that their adverts meet the new requirements. Both VSP providers and advertisers may therefore wish to respond to the consultation in order to help shape the future framework.

Statutory background

The Audiovisual Media Services Regulations 2020

The Communications Act 2003 (the Act) was amended by the Audiovisual Media Services Regulations 2020 (the Regulations) in November 2020. The Regulations introduced regulatory requirements for UK VSPs, to be enforceable by Ofcom. We previously reported on the Regulations here.

Part 4B of the Act requires VSP providers to take appropriate measures to protect under-18s from harmful content in videos, and the general public from videos containing violence, hatred and illegal content, as well as various advertising requirements, discussed below. Ofcom has previously consulted on proposed guidance to help providers assess whether they need to notify Ofcom that they are operating a VSP, and are as such bound by part 4B of the Act, which we reported on here.

The Online Safety Bill

The draft Online Safety Bill (the Bill), which we discuss here, will replace the Act as the statutory framework for online harms when it comes into force. However, the Bill will not cover paid-for advertising requirements. Instead, it is proposed that the current provisions in the Act be repealed, with the Advertising Standards Authority (ASA) becoming a co-regulator, alongside Ofcom.

Advertising on VSPs – what is in scope?

The Act captures advertising and other commercial content on VSPs under the term 'audiovisual commercial communications' (AVCCs). AVCCs include conventional advertising as well as sponsorship, teleshopping and product placement, influencer marketing and other forms of advertising associated with VSPs (advertising).

Advertising requirements

In addition to the requirements to protect against online harms, part 4B and Schedule 15A of the Act contain specific requirements to protect users against potential harms related to advertising on VSPs, including that advertising must be readily recognisable as such, and must not use techniques which allow a message to be conveyed subliminally or secretively. The Act also lists what advertising on a VSP may not do, for example: include or promote discrimination.

The Act also contains provisions on prohibited and restricted products, such as alcohol, tobacco products, and prescription only medicines, as well as provisions relating to transparency.

Control of advertising

The extent to which the above requirements apply to VSPs under the Act depends on whether VSPs are in 'control' of the advertising or not. Where the advertising is marketed, sold or arranged by the VSP provider, advertising is deemed to be VSP-controlled. The terms 'market', 'sell' or 'arrange' are used together to determine the amount of control.

Proposed framework

Ofcom proposes to reflect the distinction in the Act between differing degrees of control VSPs have over advertising, as follows:

Where VSP providers are responsible for ensuring compliance with certain requirements above (i.e. where the advertising is marketed, sold or arranged by the VSP provider), Ofcom is proposing to designate to the ASA as a co-regulator; and

Where VSP providers are not responsible for compliance (i.e. where the advertising is not marketed, sold or arranged by the VSP provider), providers must take appropriate measures contained in the Act to ensure that advertising meets certain requirements. Ofcom will assess the appropriateness of the measures taken and will have enforcement powers for breach of appropriate measures including financial penalties of up to 5% turnover or £250,000 (whichever is greater).

Proposed guidance

Ofcom's proposed guidance sets out how it considers advertising to be 'marketed' 'sold' or 'arranged' by VSP providers, as well as the measures which may be appropriate for non-VSP-controlled advertising, and is aimed at helping VSPs to self-assess the degree of control they have over advertising. The rationale for this is that often the distinction is not as easy to make as the Act may suggest. Currently, the Act requires that all advertising is classified into either controlled or non-controlled, whereas in practice there is usually a spectrum of control. The proposed guidance on what constitutes appropriate measures for non-controlled advertising should be read alongside Ofcom's consultation on guidance for VSPs on measures to protect users from harmful material.

Consultation

Ofcom is seeking views on its proposed frameworks and guidance in relation to both controlled advertising, and non-controlled advertising and appropriate measures, as well as views on the proposed designation of the ASA as a co-regulator in respect of VSP-controlled advertising.  

The consultation closes on 28 July 2021 and responses can be submitted using the form listed under the 'Responding to Consultation' section here.

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