HomeInsightsNeed to Know – 2013.03.04

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General

Hidden theatre ticket booking fees targeted by Advertising Standards Authority. 

High Court rules sub-licence of copyright survived termination of head licence.  

Technology

European Commissioner Neelie Kroes announces €50 million for research to deliver 5G mobile technology by 2020. 

European Commissioner, Neelie Kroes, calls on EU telecoms industry to join together to create single mobile market. 

Internet Corporation for Assigned Names and Numbers announces launch of “Trademark Clearinghouse”. 

Internet Corporation for Assigned Names and Numbers announces implementation of its Expired Registration Recovery Policy for domain names.

Ofcom proposes to reduce prices for high-speed data links. 

Prize Draws, Promotions and Competitions

ASA rules Red Bull had insufficient grounds to describe prize promotion as a “VIP trip”.

Music

IFPI publishes Digital Music Report 2013, which shows that digital is driving the recorded music industry towards recovery. 

High Court orders internet service providers to block access to three peer-to-peer file sharing websites. 

Publishing

Press Complaints Commission rejects complaint from Lord Ashcroft against The Independent in rare ruling on reporting defamation outcome. 

Media Standards Trust calls for greater transparency in process of press reform. 

Members of House of Lords complete third reading of Defamation Bill. 

Attorney General takes action over Jon Venables and Robert Thompson injunction. 

Film & TV

British Board of Film Classification publishes online survey as part of a review of Film Classification Guidelines.

Corporate

Government announces scrapping of certain regulations on the day-to-day running of companies.

Computer Games

Association for UK Interactive Entertainment tells Government’s Culture, Media and Sport Select Committee about issues facing the UK games sector. 

Association for UK Interactive Entertainment announces nationwide “Tax Relief Roadshows”.

Advertising

Committee on Advertising Practice publishes new guidance on use of children in peer-to-peer marketing and as brand ambassadors. 

General

Hidden theatre ticket booking fees targeted by Advertising Standards Authority (ASA).

The ASA has ruled against four theatre ticket providers for quoting misleading ticket prices on their websites.

By way of example, The Old Vic theatre online booking page featured an interactive map of the theatre’s seating.  Hovering the cursor over each section produced a pop-up, which gave the price band for seats in that section.  Hovering the cursor over the “Stalls” section produced a box that stated “Stalls £16.00 – £70.00 Standard”.  The complainant challenged whether the price claims were misleading because they did not make clear that a booking fee also applied.

The Old Vic said that it was concerned that, because the fee was per transaction and not per ticket, putting it in the hover-over box might confuse people into thinking they had to pay that fee per ticket when that was not the case.

In its adjudication, the ASA referred to the CAP Code requirement that quoted prices must include non-optional fees and charges.  The ASA considered that, because the prices stated in the hover-over box were the first prices that customers using the online booking process would see, those prices needed to be immediately qualified with a reference to the amount of the booking fee.  Accordingly, the ad breached CAP Code rules 3.1 (Misleading advertising), 3.17 and 3.18 (Prices).

Summarising all four rulings, advertisers should note that if a booking fee is a one-off charge, unrelated to the number of tickets bought, then the ASA accepts that it cannot be incorporated within individual ticket prices.  In that situation advertisers should state, for example, “plus online booking fee*”, where the asterisk links to a separate explanation which includes the amount.  This is especially the case when the price claims in question are the first references to prices for a performance.  Additionally, booking fees also need to be clearly itemised in the shopping cart at the end of the transaction.

The ASA also makes clear that advertisers cannot rely on the presumption that customers mostly use ticket websites to check start times, theatre locations and prices with a view then to going to the box office to buy booking-fee exclusive tickets.  The ASA suggests that where compulsory charges apply, such as online commissions, the ad can provide separate itemisations of the headline price making clear its components, provided they are no more prominent than the headline price.  Alternatively, ads can quote booking-fee exclusive prices provided they are clearly targeted to box office customers.  To access the ASA press release and for further links to the adjudications, click here.

High Court rules sub-licence of copyright survived termination of head licence.

VLM Holdings granted an informal licence to its subsidiary VLM (UK) Ltd to exploit the copyright in printing software in the UK.  VLM Holdings and VLM UK shared common directors.  VLM UK granted a licence to use the software to the estate agent Spicerhaart so it could use it to print documents.  VLM UK went into liquidation and VLM Holdings terminated its right to grant licences.  VLM Holdings then granted an exclusive licence over the software to the defendant, Ravensworth, another printing company.

Spicerhaart sought to rely on its licence.  Ravensworth claimed that that licence negated its own exclusivity, and claimed material breach of the terms of the exclusive licence, thereby entitling it to end its obligation to pay royalties, and on the terms of that licence to have the beneficial ownership of the copyright.  The court was required to determine whether the Spicerhaart licence survived the termination of the head licence, and if so, what effect that had on the licensing agreement between VLM Holdings and Ravensworth.

The court held that the effect of termination of a head licence on a sub-licence depended on the terms of the original grant, and on the terms of the sub-licence.  Applying agency principles, Mann J found that the common directorship and aims of VLM Holdings and VLM UK meant that the former was fully aware of and must have approved the Spicerhaart licence and its underlying purpose, which was to protect Spicerhaart from disruption to its use of the software due to issues connected with VLM UK.  Further, the Spicerhaart licence described VLM UK as the owner of the copyright and it was plain on the facts that the directors of VLM Holdings, in that capacity, allowed VLM UK to make that statement in the Spicerhaart licence.  In Mann J’s view the directors of VLM Holdings impliedly consented to that licence and impliedly authorised VLM UK to grant it.  For these purposes Mann J held that VLM Holdings should be treated as an undisclosed principal and, on normal principles, Spicerhaart was entitled to hold it to the relevant part of the contract (i.e. the permission). 

In conclusion, the permission in the licence was one that bound both VLM UK and VLM Holdings.  Further, bringing to an end informal licensing arrangements between them did not affect the permission already given by VLM Holdings.  As such, the Spicerhaart licence persisted.  Given the continuance of that licence, VLM Holdings was in breach of the exclusive licence granted to Ravensworth.  That breach was plainly material, entitling Ravensworth to terminate the agreement. (VLM Holdings Ltd v Ravensworth Digital Services Ltd [2013] EWHC 228 (Ch) (13 February 2013) – to read the judgement in full, click here).

Technology

European Commissioner Neelie Kroes announces €50 million for research to deliver 5G mobile technology by 2020.

Ms Kroes said that the aim of the funding was to put Europe back in the lead of the global mobile industry.  “I want 5G to be pioneered by European industry, based on European research and creating jobs in Europe – and we will put our money where our mouth is, she said.

The Commission says that by 2020 worldwide mobile traffic alone will have increased by 33 times compared to 2010 figures.  In this time internet access will become dominated by wireless devices such as smartphones, tablets, machines and sensors, requiring more efficient and ubiquitous technology to carry the data traffic.

The Commission says that this new wave of research projects “promises to bring cutting-edge ultra-high-speed mobile broadband technology to the daily lives of Europeans”.

EU industrial players joining forces with academia and research institutes involved in these projects include worldwide telecom operators (British Telecom, Deutsche Telekom, France Telecom/Orange, Telecom Italia, Telefonica, Portugal Telecom) and the world’s major telecom manufacturers (Alcatel-Lucent, Ericsson, Nokia, Nokia Siemens Networks, Thales Communications) as well as the world’s leading provider of business software (SAP) and also world-renowned automotive manufacturers (BMW).  To read the Commission’s press release in full, click here.

European Commissioner Neelie Kroes calls on EU telecoms industry to join together to create single mobile market.

Speaking at the Mobile World Congress 2013 in Barcelona, Ms Kroes expressed her disappointment at the digital Connecting Europe Facility funding being cut by over €8 billion in the latest EU budget, but said that she was “still determined to deliver broadband for all”.

Ms Kroes said that she would deliver a “wireless action plan”, which would look at how to find more spectrum and how to make it easier and worthwhile to invest, as well as ways to simplify and speed up permit procedures and new ways to share infrastructure that do not limit the ability or incentive to innovate and compete.

Ms Kroes said that, “Member States support our broadband targets; and many of them actively call for a Digital Single Market.  Our proposals will help deliver both of those goals”.  However, she acknowledged that, “this will not be politically easy”.  Instincts will be to resist and stick to the safety of the status quo and the comfort of longstanding practice in both the public and private sectors, she said.  In Ms Kroes’ view, however, in the long run “that would damage our competitiveness, harm our industry, and cut Europeans off from a world of online opportunity”.

Ms Kroes also said that she wanted Europe to lead the world in developing the next generation of technology, i.e. 5G technology.  “Europe has the funds, the will, and the expertise to succeed here”, she said, calling on EU industry and other partners to join together in a public-private partnership.  

However, Ms Kroes said, none of it mattered without broadband connections that are “reliable, pervasive, fast”.  The fact is, she said, “if we don’t provide the spectrum, the networks, or the most up-to-date technology, then that innovation just won’t be possible: we would be blocking off tomorrow’s opportunitiesAnd I don’t think citizens of any generation, would forgive us that”.  To read Ms Kroes’ speech in full, click here.

Internet Corporation for Assigned Names and Numbers (ICANN) announces launch of “Trademark Clearinghouse”.

On 26 March 2013, ICANN will unveil a global repository for trade mark data, the first of its kind in the domain name space.  The “Trademark Clearinghouse” will enable companies and individuals to protect their trade marks while new generic Top-Level Domains are introduced into the domain name system.  Rights holders whose trade mark information has been verified by the Clearinghouse will then have the opportunity to participate in a set of services designed to help protect their rights.

The Clearinghouse operations will be divided into two functions:

  1. Trademark Validation: As of 26 March 2013, rights holders will be able to submit trade mark data at www.trademark-clearinghouse.com.  Deloitte Enterprise Risk Services will be responsible for verifying these trade mark submissions.
  2. Database Administration: ICANN is working with IBM on management of the “Trademark Clearinghouse” database, including the provision of relevant data to new gTLD registries and registrars for Sunrise and Claims services.  These systems should be operational later in 2013.

Rights holders that register their marks with the Clearinghouse will receive:

  • access to Sunrise registration: the Sunrise period allows eligible trade mark holders the opportunity to register their marks as domain names in advance of the general public; and
  • notification of registration: during Sunrise and Claims periods, the Trademark Clearinghouse will alert rights holders when a domain name is registered that matches the rights holder’s trade mark in the Clearinghouse.

To read ICANN’s press release in full and for more information, click here.

Internet Corporation for Assigned Names and Numbers (ICANN) announces implementation of its Expired Registration Recovery Policy for domain names.

ICANN says that the aim of the new Policy is “to promote better understanding of registrants’ options and help alleviate common issues related to the expiration of gTLD registrations”.  The policy is intended to help align registrant expectations with registrar practices by establishing certain minimum communications requirements. 

The most notable provisions of the Policy are as follows:

  • to help prevent unintended expiration of domain name registrations, registrars will be required to notify registered name holders of the expiry date of their registrations at least twice: approximately one month prior to the expiry date and, again, approximately one week prior to the expiry date;
  • all gTLD registries must offer a “Redemption Grace Period” of 30 days immediately following the deletion of a registration.  During this period, the registrant must be permitted by its registrar to restore the deleted registration;
  • to promote consumer choice and awareness, registrars must make their renewal and redemption fees reasonably available to registered name holders and prospective registered name holders at the time of registration of a domain name; and
  • registrars may still delete registrations at any time after they expire, subject to applicable policies and provisions of the Registrar Accreditation Agreement.  However, the new Policy requires that resolution of the domain name be interrupted for a period of time after expiry, but before deletion, of the name to help make the registrant aware of the expiry of its domain.  Additionally, any parking page hosted by the registrar at the expired domain name must include or point to renewal instructions.

All ICANN-accredited registrars and gTLD registries are required to comply with the new Policy by no later than 31 August 2013.  To read the ICANN press release in full, click here.

Ofcom proposes to reduce prices for high-speed data links.

Ofcom has notified the European Commission of proposals to reduce prices for high-speed data links that support UK businesses as well as mobile and broadband providers.  This follows Ofcom’s Business Connectivity Market Review, which examined the £2 billion-a-year market for wholesale leased lines. 

The proposals are subject to comments from the European Commission.  They include new price controls on BT, the major provider of wholesale leased line services, which would significantly reduce the price of newer products based on modern Ethernet technology for many businesses.  This, Ofcom says, “will help meet the growing demand for fast data services from the likes of schools, universities, mobile operators, internet providers and consumers”.

Ofcom is proposing that BT’s very high-bandwidth, wholesale leased line services at speeds above 1 Gbit/s in all parts of the UK, except London and Hull,should be subject to regulation, as BT has been found to have “significant market power” in this relatively new market.

For Ethernet products with speeds up to and including 1 Gbit/s, Ofcom’s draft decision is broadly to maintain existing regulation, including charge controls and a requirement on BT to provide access on a strictly non-discriminatory basis.  Ofcom is, however, proposing to impose significant price reductions outside London, at 11% below inflation per year over the next three years.

Under the draft decisions, BT’s prices for leased lines based on older technology will be permitted to rise modestly to reflect higher costs in this declining market.  Ofcom says that reductions in Ethernet charges “will provide customers with a cheaper alternative and an incentive to migrate to newer, more efficient technologies”.

As for the London area, Ofcom proposes to impose lighter regulation, where BT faces greater competition from other providers.  This would involve safeguard caps on products up to and including 1 Gbit/s, and no regulation on very high bandwidth products, where there is effective competition.  Ofcom is also proposing to deregulate the market for longer-distance legacy leased lines and to require BT to provide its regulated Ethernet services on the same basis to all retail providers.

Ofcom says that the draft measures are designed to promote competition.  The intention is that they will also help ensure that the UK has a backbone of high-speed business networks capable of supporting not only companies, but also consumer services that ultimately rely on these networks, such as superfast broadband and mobile video streaming.

The European Commission will now consider the proposals and Ofcom expects to publish a final statement towards the end of March 2013.  Ofcom says that the new charge controls would commence on 1 April 2013 and remain in place for three years.  To read Ofcom’s press release in full, click here.

Prize Draws, Promotions and Competitions

ASA rules Red Bull had insufficient grounds to describe prize promotion as “VIP trip”.

The complainant’s excitement at winning Red Bull’s prize promotion of a VIP trip to the Belgian Grand Prix gradually gave way to disappointment as, one by one, the components of the trip became less VIP and more sub-standard.

The prize promotion, on an online magazine, stated “WIN A VIP TRIP TO WATCH THE BELGIUM GRAND PRIXwe’re giving one winner a pair of tickets to watch the action as well as a flights [sic] and accommodation at the luxurious four-star Beaumont hotel for two nights”.

The complainant objected to a variety of issues relating to the administration of the promotion that included the short notice that was given between being informed that he had won and the event itself; that he had to share a bed with his brother despite requesting two single beds; the fact that the airport, hotel and event spanned three different countries (while the event was in Brussels, the winners would have to fly to Cologne in Germany and then travel (at their own expense) to the hotel in the Netherlands); that their suitcases had to be taken to the event; and that they had to leave the event early due to the timing of the return flight. 

Red Bull made a number of points in response, namely that: the ad did not claim that event tickets were VIP; the VIP headline referred to the entire package; the event tickets cost over £300 each and were not standard tickets; the flight was short haul offering only one class of travel and the details of the hotel were stated on the front page of the promotion.  Additionally, Red Bull said that the complainant was informed of the flight departure details on 28 August 2012, in accordance with the terms and conditions, and that he was informed prior to the event that, other than the flights, he and his companion would have to organise their own travel.  Finally, Red Bull said that it understood that the complainant was wrongly informed by email that the accommodation was at a spa hotel when this was not the case.  It said, however, that the name of the hotel was stated on the promotion.

The ASA considered that information relating to the different locations of the event, airport and hotel, and that travel to and from them was not included, was significant information likely to influence consumers’ understanding of the promotion and should therefore have been stated clearly in the promotional material.  The other issues including the baggage fiasco and the return flight timing simply reinforced the ASA’s opinion that the promoter had not made available adequate resources to administer the promotion equitably or efficiently.

Furthermore, the ASA said that the term “VIP”, in the context of the ad, was likely to be understood by readers as exclusive, and non-standard.  It also referred to the specific meaning of “VIP” in the ticketing industry, which usually means admission to a VIP area.  The ASA added that while there was no reference to the hotel as a spa hotel, in either the promotional material or the terms and conditions, the email indicating as much meant that it was reasonable for the complainant to expect to stay in a luxurious spa hotel.  The ASA concluded that the promotion was misleading and breached CAP Code rules 3.1 (Misleading advertising), 8.2 (Sales promotions), 8.14 (Administration) and 8.17 and 8.17.1 (Significant conditions for sales promotions).  To read ASA Adjudication on Red Bull Company Ltd (27 February 2013), click here.

Music

IFPI publishes Digital Music Report 2013, which shows that digital is driving the recorded music industry towards recovery.

IFPI says that the global recorded music industry is “on a path to recovery” fuelled by licensed digital music services and rapid expansion into new markets internationally.  Recorded music is also helping drive a broader digital economy, according to IFPI’s annual Digital Music Report 2013

According to the Report, global recorded music industry revenues rose by an estimated 0.3% to US$16.5 billion in 2012, the first year of industry growth since 1999.  Digital revenues saw accelerating growth for the second year running, up 9%, with most major digital revenue streams (downloads, subscription and advertising-supported) on the rise. 

IFPI says that the digital music business is globalising fast, as smartphones and new licensed services span new and emerging markets.  In January 2011, the major international download and subscription services were present in 23 markets.  Today, they are in more than 100.  Consumer research published by Ipsos MediaCT, covering nine markets in four continents, shows that 62% of internet users have used a licensed music service in the last six months.

Frances Moore, chief executive of IFPI said: “It is hard to remember a year for the recording industry that has begun with such a palpable buzz in the air.  These are hard-won successes for an industry that has innovated, battled and transformed itself over a decade.  They show how the music industry has adapted to the internet world, learned how to meet the needs of consumers and monetised the digital marketplace”.  

Key barriers to further growth remain, however, the biggest being unfair competition from unlicensed music services.  IFPI says that governments have a key role to play in addressing this problem.  The key priority remains to “secure effective cooperation from intermediaries including advertisers, ISPs and search engines, who have a major influence on levels of copyright infringement”.

The Report also showed that:

  • download sales increased in volume by 12% globally in 2012 and represented around 70% of overall digital music revenues;
  • the number of people paying to use subscription services leapt 44% in 2012 to 20 million.  Subscription revenues are expected to account for more than 10% of digital revenues for the first time in 2012;
  • digital channels account for the majority of record companies’ income in an increasing number of markets including India, Norway, Sweden and the US;
  • digital retailers’ rapid global expansion is opening up the potential for markets, such as Brazil and India, to become major sources of future industry growth;
  • consumer satisfaction with licensed music services is demonstrably high with 77% of users of licensed services rating them as excellent, very good or fairly good.  Even 57% of those who use unlicensed services believe “there are good services available for legally accessing digital music”;
  • many non-digital revenue channels are also increasing.  Performance rights income increased in value by an estimated 9.2% in 2012 and now accounts for around 6% of overall industry revenues, up from 3% in 2007; and
  • album charts in most markets show that investment in local repertoire is alive and well.  In many countries, local repertoire accounts for the vast majority of the top selling albums of the year.  Five major non-English language markets illustrate this.  In Italy, Spain and Sweden, eight in ten of the top selling albums of 2012 were by local artists; in Germany, seven in ten, and in France six in ten.

For a link to the Report, click here.

High Court orders internet service providers to block access to three peer-to-peer file sharing websites.

The record company claimants sought an injunction pursuant to s 97A of the Copyright Designs and Patents Act 1988 against the six main ISPs operating in the UK, requiring them to take measures to block or at least impede access by their customers to three peer-to-peer file-sharing websites called KAT, H33T and Fenopy.  The application was supported by PRS for Music, the MPA, UKIE, Producers Alliance for Cinema and Television and The Publishers’ Association.

The defendant ISPs did not oppose the grant of the orders sought and agreed the terms proposed, provided that the court was satisfied that: i) it had jurisdiction to make such orders; and ii) it was appropriate to do so.

The three websites concerned operated as Bittorrent indexing websites providing an organised directory of content that users could browse and from which they could select and download the sound recordings of their choice.

Mr Justice Arnold noted that, in order for the court to have jurisdiction to grant the orders sought, four matters had to be established: i) that the defendants were service providers; ii) that the users and/or operators of the websites infringed copyright; iii) that the users and/or operators of the websites used the defendants’ services to do that; and iv) that the defendants had actual knowledge of this.

Arnold J was in no doubt that the defendants were service providers.  As for infringement by users of the websites, it was clear, Arnold J said, that a user who selected a torrent file in order to obtain a copy and then downloaded that file, was copying the content onto his/her computer.  If that file comprised a copyright work and the user did not have a licence, he/she was infringing copying.  In addition, Arnold J found that, as he had found in Dramatico Entertainment Ltd v British Sky Broadcasting Ltd [2012] EWHC 268 (Ch), the actions of uploaders of copyright material onto the websites amounted to “communication to the public” under Article 3(1) of the Copyright Directive (2001/29/EC).  This was because they made recordings available by electronic transmission so that the public could access them from a place and time of their choosing, and they communicated the recordings to a new public, i.e. all other users of the websites, which amounted to an indeterminate class of people.  Further, where the uploader was located in the UK, “communication to the public” occurred in the UK.

As for the operators of the websites, Arnold J found that their actions also constituted “communication to the public” since communication was by electronic transmission (as in Twentieth Century Fox Film Corp v Newzbin Ltd [2010] EWHC 608 (Ch)), to a new public (following the criteria identified in Case C-135/10 SCF v Del Corso), and targeted at the public in the UK (following Case C-173/11 Football Dataco Ltd v Sportradar Gmbh).

Further, Arnold J found that the operators had committed the tort of authorising infringement by UK users since, “The entire purpose of each of the Websites is to attract users to them by providing those users with the free means of copying and making available content which people are interested in and would otherwise pay money for”.

Moreover, Arnold J found that the operators “induce[d], incite[d] or persuade[d] their users to commit infringements of copyright, and that they and the users act[ed] pursuant to a common design to infringe”.  Accordingly, they were jointly liable for the infringements committed by users.

Arnold J then considered whether the users and/or operators used the defendants’ services to infringe, finding that, as he had found in both Twentieth Century Fox Film Corp v BT plc [2011] EWHC 1981 (Ch) and Dramatico Entertainment v British Sky Broadcasting (No 2) [2012] EWHC 1152 (Ch), they did so infringe.  The evidence confirmed substantial use by users of the defendants’ services for infringing activities. 

Finally, Arnold J found that the defendants did indeed have actual knowledge of the infringing activities as, on the evidence, they had been notified by the claimants (via BPI) and by MarkMonitor, who had been engaged by IFPI to monitor the activities of P2P users in the UK, that their services were being used to infringe copyright.  Further, Arnold J considered that the orders sought by the claimants were proportionate.  They were, he said, “necessary and appropriate to protect the intellectual property rights of the Claimants (and other copyright owners)” and that those interests, “clearly outweigh[ed] the Charter Article 11 rights of the users of the Websites, who can obtain the copyright works from many lawful services”.  Arnold J therefore made the orders sought by the claimants.  (EMI Records Ltd v British Sky Broadcasting Ltd [2013] EWHC 379 (Ch) (28 February 2013) – to read the judgment in full, click here).

Publishing

Press Complaints Commission (PCC) rejects complaint from Lord Ashcroft against The Independent in rare ruling on reporting defamation outcome.

The PCC has ruled that The Independent did not breach Clause 1 (Accuracy) of the Editors’ Code of Practice following a complaint from Lord Ashcroft that the newspaper had failed to fulfil its obligation to publish a fair and accurate report of the outcome of an action for defamation against the newspaper.

The libel claim by Lord Ashcroft was pursued against the previous publisher (Independent News and Media) of The Independent and concluded in November 2012 when an agreed statement was read in open court.  On 5 December 2012, The Independent reported the outcome of the proceedings in print and online.  Lord Ashcroft complained that the headline, “Ashcroft drops High Court action after apology” suggested, inaccurately, that he had “abandoned” his libel claim rather than the true position, which was that he had agreed not to pursue it as part of a settlement.  He was also concerned that the article had not reproduced the retraction made by the publisher in full; that other references were calculated to distance the current publishers of the newspaper (Independent Print Ltd) from the retraction and apology; that the report had been excessively delayed; and that it had been given insufficient prominence.

The Independent noted that neither it nor Independent Print Ltd had been party to the legal action and said it had no control over the terms of the settlement.  Lord Ashcroft had not sought to reach any agreement in advance with the publisher or the present editor of The Independent as to how it should be reported.  The newspaper had initially been uncertain as to whether the obligations of the Code still applied given the change of ownership, but had ultimately decided to proceed with publication.  It considered that the item had made clear the central issues, i.e. that serious allegations linking the complainant to corruption in the Caicos Islands had been withdrawn, and that INM had apologised to Lord Ashcroft.  The newspaper maintained that the headline was accurate and represented “commonplace” terminology in such instances.  Nonetheless, it offered to amend this online to refer to a “settlement”. It noted that the Editors’ Code does not include a requirement as to the timeliness of such publication, and said that the delay in this instance did not make the report “unfair”.

Clause 1(iv) of the Editors’ Code states that “a publication must report fairly and accurately the outcome of an action for defamation to which it has been a party, unless an agreed settlement states otherwise, or an agreed statement is published”.  The PCC said that The Independent was required to report the outcome of the legal action for the benefit of its readers as well as for the complainant, noting that “the obligation arose because it had published the material under complaint and the newspaper was not released from the obligation following the change of ownership”.  The delay in publishing the outcome of just over a week was “regrettable”, it said, but not significant in the context of a three-year legal action.  Although Lord Ashcroft argued that the article had been given inadequate prominence, in the PCC’s view, the prominence of the item met the requirements of Clause 1(iv).  The PCC noted Lord Ashcroft’s objection to the reference in the headline to the claim having been “dropped”, but it did not consider that this terminology was significantly misleading in the context of the full report.  Noting that the newspaper had “properly discharged its obligations” under the Code, it did not uphold the complaint.  To read PCC adjudication on Lord Ashcroft v The Independent (28 February 2013), click here.

Media Standards Trust (MST) calls for greater transparency in the process of press reform.

The director of the MST has written to Lord Black and Lord Hunt calling for them to open up the process that has so far, it says, “been characterised by clandestine talks and behind-closed-doors agreements”.  The MST put six question to Lords Black and Hunt in order to establish their commitment to transparency and to the public.

The MST wants the press to open up the process of reform to public scrutiny.  If it does not, it risks “losing political and public confidence”, the MST says.

In letters sent last week to Lord Black and Lord Hunt, the Trust said that the public do not know: who is leading the process of reform; what the process involves; how, if at all, the public will be included; and any details of meetings that have been held to date, notably with government Ministers and officials.

Lord Justice Leveson, in his report, strongly criticised the plan put forward by Lord Black and Lord Hunt, writing that he found it “extraordinary”, that “they did not regard public views on the matter [of their proposal] as of sufficient interest or importance to make any effort to ascertain them”.  Leveson LJ in fact went further, saying, “This lack of interest in the views of the public may be symptomatic of the approach that the press has consistently taken towards regulation over many decades”.

The MST says that the result was a system that worked for the press but not for the public.  “I have said, many times”, Leveson continued, “that any new regulatory system must work for the public and for a system to work for the public it should have the rights and interests of the public at its heart”.  The proposal put forward by the industry “manifestly fails that test”.

In the MST’s view, despite Leveson LJ’s criticisms, there are still no signs that the press regards the views of the public as of sufficient interest or importance to make an effort to ascertain them.

The MST put six questions to Lord Black and Lord Hunt to test their commitment to openness:

  • What is the “Industry Implementation Group”; what is its remit; and who is on it?
  • Paul Vickers, Chairman of the “Industry Implementation Group”, was reported as saying that the draft Royal Charter was “the fruit of two months of intensive talks involving the newspaper and magazine industry and all three main political parties”.  Will the industry be publishing details of these “intensive” talks?
  • Did the newspaper and magazine industry request any changes be made to the recognition criteria in the draft Royal Charter before publication?
  • Will the industry be publishing any details of the meetings held by the industry about the development of a new system between December 2012 and February 2013?
  • Does the industry plan to make future meetings and proposals for a new system public?
  • How does the industry plan to involve the public in the development of a new system (beyond the limited consultation on the Code)?

Martin Moore, director of the MST, said: “The newspaper editors criticise politicians and other institutions for not being transparent and rightly expose secret talks and backroom deals.  Yet when it comes to press reforms, there is a studied silence and almost complete lack of scrutiny”.

The MST is awaiting a response from Lord Black and Lord Hunt.  To read the MST’s press release in full, click here.

Members of House of Lords complete third reading of Defamation Bill.

On 25 February, the bill had its third reading in the House of Lords, which was the final chance for any amendments.

Lord Fowler (Conservative) opened the debate by proposing an amendment to Clause 2.  He explained the overall purpose of the clause: “… which is to provide a low-cost remedy for the public and the press without the expense of going to law”.  The amendment sought to amend Lord Puttnam’s (Labour) amendment made in the report stage to introduce a low-cost arbitration system for victims of defamation.  Lord Puttnam had said, when introducing the amendments, that they closely follow [Leveson LJ’s] recommendations, which laid out exactly the way in which this system of low-cost arbitration should be introduced to deal with legal disputes involving newspapersHowever, Lord McNally (Liberal Democrat), responding on behalf of the Government, said that: “The amendment of my noble friend Lord Fowler is welcome in so far as it will remove an element of the Puttnam amendment that went further than Lord Justice Leveson recommended”.  The amendment was agreed.

The Defamation Bill has now completed its passage through the House of Lords and will be returned to the Commons with amendments for consideration.  For further information on the Bill’s passage through Parliament, click here.

Attorney General takes action over Jon Venables and Robert Thompson injunction.

The Attorney General has decided to institute contempt proceedings against a number of individuals who have been identified as having posted online photographs purporting to be of Jon Venables or Robert Thompson.

There is currently an injunction in place, which prevents publication of any images or information purporting to identify anyone as Jon Venables or Robert Thompson.  The terms of the order mean that if a picture claims to be of Venables or Thompson, even if it is not actually them, there will be a breach of the order.  Providing details of the new identities of Venables and Thompson or their whereabouts is also prohibited.  The order applies to material on the internet as well.

The Attorney General’s Office says that there are many different images circulating online claiming to be of Venables or Thompson and potentially innocent individuals may be wrongly identified as being one of the two men and placed in danger.  The order, and its enforcement, is therefore intended to protect not only Venables and Thompson, but also those members of the public who have been incorrectly identified as being one of the two men.

The Attorney General’s Office reminds readers that the injunction applies to both media organisations and individuals, warning that: “Anyone who has posted material online which is in breach of the terms of the order should remove this material immediately.  Breaches of the order may be a contempt of court punishable by a fine and/or imprisonment”.

The Attorney General’s Office also reminds readers that it is “a criminal offence to encourage others to commit acts of violence or to publish online malicious communications.  The police will investigate and arrest individuals believed to be responsible for such acts”.  To read the press release in full, click here.

Film & TV

British Board of Film Classification (BBFC) publishes online survey as part of a review of Film Classification Guidelines.

Every four to five years, the BBFC carries out a large-scale public consultation exercise to review the BBFC Classification Guidelines for age rating films to ensure that they are in step with public opinion.  The online survey, which is open for six weeks closing on 12 April 2013, is part of this general review of the Guidelines.

The survey asks the public to give their views on the age ratings of recent cinema and DVD releases.  It also captures how often respondents visit the cinema, watch films online and whether they usually watch films with a particular age rating.

The results of the online survey will be processed alongside the results of nationwide focus groups, telephone interviews and specialist research, giving the BBFC the views of around 10,000 members of the public.  The updated BBFC Classification Guidelines will be published at the end of 2013.  The last BBFC Classification Guidelines Review was carried out in 2009.  For a link to the online survey, click here.

Corporate

Government announces scrapping of certain regulations on the day-to-day running of companies.

The announcement by Business Minister, Jo Swinson, is based on the interim results from the Government’s “Company and Commercial Law Red Tape Challenge”.  The results showed that half of the 115 regulations on the day-to-day running of a company and the preparing and filing of their accounts should be scrapped, merged or simplified.  The Government says that this “will cut down the dead weight of the statute book by removing redundant legislation and ensure that the remaining regulations are simpler to understand”.

Ms Swinson said: “The Companies Act is understandably a complex bit of law.  However, there are many areas where this has resulted in companies unnecessarily being tied down by red tape.  Businesses told us through this bureaucracy cutting exercise just how time consuming some of the form filling is and how the rules they have to abide by are completely redundant.  We have heard them loud and clear and are now taking action”.

The Government also announced:

  • Reform of the company and business names regime: Proposals include removing certain names from the list of words that require approval from specified bodies before being registered at Companies House.  Some names will still need approval such as those which may cause offence.
  • Measures to simplify the regulations a company must abide by when displaying the company name at their premises, on paper or online: The proposal will enable companies to find all the rules together in one place.
  • Proposals for companies with fewer than ten employees (micro-businesses) to be freed from red tape by removing certain accounting requirements: Micro-businesses will be able to draw up shortened balance sheets and profit and loss accounts and will remain exempt from the requirement to file the profit and loss account.
  • Other amendments to the Companies Act: These will simplify the system for companies to use assets to raise finance, streamline company annual reporting requirements and repeal certain filing obligations when companies change their auditors.

The Government says that it is working with Companies House to consider what further improvements can be made in relation to information sent to Companies House, in particular, whether it is possible to reduce duplication of information sent to Companies House and Government.  A second “Red Tape Challenge” announcement of proposals relating to regulations that deal with Companies House will be announced later this year.

Computer Games

Association for UK Interactive Entertainment (UKIE) tells Government’s Culture, Media and Sport Select Committee about issues facing UK games sector.

UKIE, representing the UK games industry, has highlighted the issues facing the UK games sector as part of the Culture, Media and Sport Committee’s inquiry into “Support for the Creative Economy”.

UKIE CEO Jo Twist outlined the importance of the UK’s games sector to the overall UK economy.  She praised the Government for supporting the industry in granting tax relief and for introducing computer science onto the National Curriculum, but said that there was more that could be done to help maximise the potential of the games industry in this country.

Ms Twist talked about the key areas that affect the games sector, emphasising the unique business models and technical solutions that the industry uses to help protect IP, but also the challenges that it faces with IP such as cloning.  She explained the sector-leading work that the industry takes to protect consumers through age ratings, parental controls and education initiatives, and discussed how the Government can help to implement new innovative ways of raising finance such as crowdfunding.  She also highlighted the need for new games clusters around the country to be supported and for the Government to help in providing better information on the size and spread of the industry, from the smallest developers to the biggest multinationals.

UKIE asked in particular that the Government should give more help in promoting the content, people and services that the UK games industry offers to investors in this country and overseas.  To read UKIE’s press release in full, click here.

Association for UK Interactive Entertainment (UKIE) announces nationwide “Tax Relief Roadshows”.

UKIE has announced that it will be holding a series of roadshows around the UK to help games businesses understand how the new legislation and the “Cultural Test” will work.

The UKIE Tax Relief Roadshows will include, amongst other things:

  • a guide on how to apply for the relief and how much it could be worth to a business;
  • an explanation of the “Cultural Test” and how to pass it; and
  • a chance to hear more about the scheme from the UKIE panel of experts from the games industry, HMRC and the BFI (who will be administering the Cultural Test).

UKIE says that it is expecting the tax relief system to be in place by April and the Roadshows are planned to start from then and go on until the end of the year.  Games businesses are being asked to register interest now to ensure that they are guaranteed a place at the Roadshows. 

UKIE CEO Jo Twist said: “We want as many games businesses as possible, throughout the country, to be able to take advantage of tax relief as soon as it is formerly introduced, hopefully this Spring.  Our nationwide roadshows will provide access to legal and accountancy experts and give games businesses the chance to speak directly to key people at HMRC and BFI who will be actually administering the new scheme, and most importantly, the Cultural Test.  Games businesses should let us know now if they’re interested so that they don’t miss out on getting access to vital information”.  To read the press release in full and for information on how to register interest in the Roadshows, click here.

Advertising

Committee on Advertising Practice (CAP) publishes new guidance on use of children in peer-to-peer marketing and as brand ambassadors.

In December 2012, CAP published the findings of its comprehensive year-long review into the use of children in peer-to-peer marketing and as brand ambassadors.  As a result of that review, CAP has published new guidance for marketers to ensure that such techniques are undertaken responsibly and in accordance with the rules in the UK Code of Non-broadcast Advertising, Sales Promotion and Direct Marketing (CAP Code).  The guidance confirms that all the rules in the CAP Code’s dedicated children’s section apply, and clarifies that brand ambassador and peer-to-peer marketing that falls within the scope of the CAP Code must:

  • be obviously identifiable as marketing activity (the guidance gives practical examples on how that can be achieved);
  • do nothing that is likely to result in the physical, mental or moral harm of children; and
  • not make children feel inferior or unpopular if they do not have a product or do not engage in peer-to-peer marketing.

For communications or marketing practices that fall outside the scope of the CAP Code, the guidance encourages marketers to seek parental consent before engaging a child in the role of a brand ambassador.  For a link to the new guidance, click here.

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